JPMorgan urges stronger crypto safeguards as it expands blockchain business

JPMorgan executives called on US policymakers to adopt a measured regulatory framework for digital assets that balances innovation with robust safeguards, according to a report on Monday.

JPMorgan executives back crypto regulation

JPMorgan's Global Co-Head of Payments, Umar Farooq and CEO of Digital Assets and Blockchain Solutions, Peter Muriungi, stated that digital assets are becoming an increasingly important part of the global financial system.

They pointed to tokenization and programmable money as technologies capable of reducing payment friction, shortening settlement times and enabling round-the-clock global commerce.

Despite recognizing the industry's potential, the executives cautioned that innovation should not outpace regulation. They argued that weak regulatory standards could expose consumers to greater risks and increase the likelihood of market instability during periods of financial stress.

“Clarity matters only if paired with durable safeguards. Clarity with gaps or loopholes can push activity into lightly supervised channels and weaken long-standing protections,” the report stated.

JPMorgan executives emphasized that the bank is actively investing in digital asset infrastructure rather than observing the sector from the sidelines.

"Across our businesses, we are investing in digital asset capabilities that respond to real client demand while operating within a risk-managed, supervised environment," they wrote.

The report also highlighted the bank's decade-long experience in blockchain technology through its Kinexys platform, including the recent launch of JPM Coin. The deposit token was designed to enable near-instant, 24/7 settlement for institutional clients.

JPMorgan is also expanding tokenization and programmable money offerings while exploring ways digital assets can improve financial services for consumer and small-business banking customers.

The executives argued that these initiatives demonstrate that innovation can advance within existing regulatory guardrails but said a more durable framework is still needed to support broader adoption.

"Responsible innovation is already possible within existing guardrails, and it can scale further with the right framework in place," they said.

They added that regulations focused solely on accelerating innovation without addressing underlying risks could ultimately undermine financial stability.

"If policy prioritizes speed over substance—if it codifies clarity while leaving fundamental risks unresolved—it will invite instability, not leadership," the executives wrote.

Beyond market structure, the authors stressed the importance of strong anti-money laundering standards, warning that exemptions for core digital asset infrastructure could weaken national security protections and market integrity.

The report comes as US lawmakers continue debating legislation to establish a comprehensive regulatory framework for digital assets, including the proposed Clarity Act.

Eleanor Terrett flags claims of JPMorgan backing Clarity Act

Journalist Eleanor Terrett noted that the JPMorgan report should not be interpreted as an endorsement of the Clarity Act, despite some market participants suggesting otherwise.

"Might be a hot take, but I didn't read the jpmorgan blog post as backing the Clarity Act, as some have suggested," Terrett wrote on X.

According to Terrett, while the bank praised digital assets for their potential to modernize financial infrastructure through tokenization, the authors stopped short of endorsing any specific bill.

Instead, they broadly advocated for a market structure framework with stronger safeguards while reiterating concerns raised by JPMorgan CEO Jamie Dimon about stablecoin yields and illicit finance.