Mastercard and JPMorgan Link Up to Bring Foreign Exchange on the Blockchain

• The collaboration is to enhance B2B cross border payments “providing greater transparency and faster settlement as well as reducing time zone friction.”

• By integrating Mastercard MTN’s connectivity with Kinexys Digital Payments, mutual customers of MTN and Kinexys will be able to settle B2B transactions through a single API.

Mastercard (MA) has connected its blockchain-based system for shifting tokenized assets, the Multi-Token Network (MTN), with JPMorgan’s (JPM) recently rebranded digital assets business Kinexys (formerly known as Onyx).

The collaboration is to enhance B2B cross border payments, the companies said in a press release on Thursday, “providing greater transparency and faster settlement as well as reducing time zone friction.”

The payments giant said it has invited a number of banks onto its MTN when the platform emerged in mid-2023 with a view to testing out tokenized bank deposits, the use of stablecoins and central bank digital currencies (CBDC). Mastercard’s token network is working specifically with the JPMorgan’s Kinexys Digital Payments, which was formerly known as JPM Coin.

Tokenized foreign exchange is an attractive subset of the blockchain-based real world assets trend now firmly embraced by traditional finance, because it offers a near-real time, always-on way to avoid cross border gaps and pain points.

The rebanding of JPM Coin to Kinexys Digital Payments was accompanied by a promise to introduce tokenized U.S. dollar and euro FX by as early as the first quarter of 2025, with plans to then expand to other currencies. Other efforts to tokenize FX payments include the Monetary Authority of Singapore’s Project Guardian, of which JPMorgan is a participant.

The firms said in a joint statement that by integrating Mastercard MTN’s connectivity with Kinexys Digital Payments, mutual customers of MTN and Kinexys will be able to settle B2B transactions through a single API.

“At Kinexys, we believe our solutions can play a transformative role in the ecosystem for digital global commerce and digital assets, where the value proposition of commercial transaction venues is enhanced by the availability of commercial bank payment rails that can natively integrate with any digital marketplace or platform,” said Naveen Mallela, co-head of Kinexys by J.P. Morgan in a statement.

“By bringing together the power and connectivity of Mastercard’s MTN with Kinexys Digital Payments, we are unlocking greater speed and settlement capabilities for the entire value chain. We are excited about this integration and the new use cases it will bring to life, leveraging the strengths and innovations of both organizations,” said Raj Dhamodharan, executive vice president, Blockchain and Digital Assets at Mastercard in a statement.