GENIUS Act Already Shaping Banking: JPMorgan Looks to Accept Crypto as Loan Collateral

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The ink has barely dried on the GENIUS Act, but it is already pushing big banks toward digital assets. JPMorgan Chase is reportedly exploring the idea of letting clients use cryptocurrency as collateral for loans, showing a clear change in how the U.S. banking sector may engage with crypto moving forward. The JPMorgan crypto loan program is still in testing, but it could mark a major shift in how banks engage with digital assets.

From Law to Test Run in Days

The GENIUS Act, now officially in effect, provides new clarity regarding stablecoins and opens the door to regulated crypto finance products. JPMorgan appears ready to act. Sources indicate that the bank is developing a pilot program that would enable institutions to secure loans by pledging assets, such as Bitcoin. Retail users will likely be left out for now, but the program could expand if it works.

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A Turnaround from JPMorgan Leadership

This shows a real change in tone. CEO Jamie Dimon has spent years dismissing Bitcoin and its peers, but things are different when rules are clearer and clients start asking for new tools. Using crypto as collateral isn’t just about staying trendy. It’s about finding new ways to serve large clients who already hold digital assets.

Why Clients Want It

There’s real demand. Institutional clients want ways to unlock liquidity without having to sell their crypto. This program could make that possible. The idea is to lock up the crypto in custody, assign a conservative value based on volatility, and issue short-term loans against it. It’s not unlike using stocks or real estate as collateral, just with more moving parts.

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Perfect Timing or Convenient Coincidence?

This news isn’t coming out of nowhere. The GENIUS Act has removed key legal barriers, and sentiment across finance is changing. Banks have tiptoed around crypto for years, but this gives them room to move without worrying about sudden regulatory blowback. With rules now written, the excuses to stay out are disappearing.

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There is Some Resistance

Even with new laws, this won’t be an easy rollout. Crypto’s price swings can cause major headaches for anyone managing risk. There’s also the issue of which coins are safe enough to qualify. Bitcoin and Ethereum are likely first in line, but anything beyond that is going to face more scrutiny. JPMorgan is expected to run tests with only a few clients before deciding how wide to go.

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What Happens If It Works

If JPMorgan launches this successfully, the impact could spread quickly. Other major banks may follow, and new products could pop up across the sector. Crypto-backed lending could become just another tool in the financial toolbox. But that only happens if the numbers make sense and the risk can be managed.

The JPMorgan crypto loan initiative shows how quickly banks are moving once legal clarity removes old barriers. The GENIUS Act laid the legal groundwork. Now banks like JPMorgan are deciding what to build on top of it. Crypto as loan collateral could stay niche, or it could turn into something much bigger. Either way, the old lines between crypto and traditional finance are starting to blur.

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Key Takeaways

JPMorgan is developing a pilot program to accept crypto like Bitcoin as collateral for institutional loans.

The move follows the GENIUS Act becoming law, which gives banks a

clearer legal footing for digital asset services.

Clients want ways to access liquidity without selling their crypto, and collateralized loans could meet that demand.

This marks a shift for JPMorgan, whose CEO was once a vocal crypto critic but now sees opportunity in the regulated space.

If successful, this pilot could push other banks to adopt similar crypto-backed lending programs in the coming months.

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