On January 14, stablecoins were a topic of discussion during JPMorgan Chase's fourth-quarter earnings call. Executives expressed support for blockchain technology while warning that some stablecoin designs could threaten the regulated banking system.
JPMorgan Chase Chief Financial Officer Jeremy Barnum stated that the bank's position aligns with the purpose of the GENIUS Act, which aims to establish regulatory safeguards for stablecoin issuance.
Barnum warned against interest-bearing stablecoins that could replicate traditional banking but lack adequate regulation. "Creating a parallel banking system with all the features of traditional banking—including deposits that look very much like interest-paying institutions—without the prudential safeguards that have been developed over centuries of banking regulation is clearly a dangerous and undesirable approach," he stated.
Barnum added that while JPMorgan Chase welcomes competition and innovation, it strongly opposes the emergence of parallel banking systems outside of the existing regulatory protection framework.
