JP MORGAN COIN: Privacy Is Paramount; Bank Aims To Hide Transaction Details

JP Morgan seems to be listening to some of the serious discussions within the crypto community. Specifically, the issue of privacy. And while most wouldn’t associate the largest bank in the world with the idea of privacy they seem to be taking notes as to what matters most to the movement: privacy.

**before we go further let’s make one thing clear – we do. Or believe that JPM will actually build a token that finds itself outside of the reach of US and global regulators. So ‘privacy’ in this context is limited.

As per a CoinDesk post moments ago: “Revealed exclusively to CoinDesk, JPMorgan has built an extension to the Zether protocol, a fully decentralized, cryptographic protocol for confidential payments, compatible with ethereum and other smart contract platforms and designed to add a further layer of anonymity to transactions. The New York-based financial institution will open-source the extension Tuesday, and is likely to use it with Quorum, the bank’s homegrown, private version of ethereum.”

“Zether, which was built by a group of academics and financial technology researchers including Dan Boneh from Stanford University, uses zero-knowledge proofs (ZKPs), a branch of mathematics which allows one party to prove knowledge of some secret value or information without conveying any detail about that secret.”

So privacy, in this case, means the ability to conceal the transaction addresses and the amounts that are being sent and received. This is about as far as a heavily regulated organization like JP Morgan could ever get away with, and even this is probably pushing the limits.

Still, from 50,000 feet, this is an effort that pushes the crypto narrative along in earnest. JPM using crypto industry products to open source their entry into the space adds a significant level of validation – even if some in crypto aren’t interested in this type of validation.

It will be interesting to eventually see what JPM unveils and how it is used in both the institutional and retail space.