JPMorgan Chase & Co. (NYSE:JPM) has filed a patent for a system which sounds an awful lot like bitcoin, according to Tracy Alloway of Financial Times. The patent is for a computerized payment system which enables users to make electronic payments anonymously over the Internet. The filing with the U.S. Patent and Trademark Office was made public late last month but filed in August
JPMorgan, other banks battle in the payments arena
Mobile payments is rapidly growing into big business, and clearly JPMorgan Chase & Co. (NYSE:JPM) wants a piece of the pie. Bitcoins provide a new opportunity because the digital currency is entirely electronic and anonymous—just like JPMorgan’s patent describes. In the patent filing, the bank said the electronic payment system could provide competition for credit and debit cards in the online payments business.
However, others are saying they see a lot of similarities with bitcoins, which have rocketed up over $1,000 in value.
Other ways JPMorgan’s patent resembles bitcoin
In addition to the electronic and anonymous aspects of JPMorgan Chase & Co. (NYSE:JPM)’s system, it also creates a public record tracing every transaction made using it. This sounds similar to how bitcoins use blockchain, which is a huge block of code which follows each part of a bitcoin from buyer to seller and on from there.
Of course JPMorgan doesn’t name bitcoin or any other digital currency. However, it mentions “emerging efforts” to challenge credit cards.
“None of the emerging efforts to date have gotten more than a toehold in the market place and momentum continues to build in favor of credit cards,” the patent filing states.
Are bitcoins vulnerable?
Those who aren’t too keen on bitcoins say JPMorgan’s patent filing shows how the digital currency could easily be challenged in the market place by imitation systems. There are other types of digital currencies, but bitcoin is the one which has grabbed people’s attentions.
Apple Inc. (NASDAQ:AAPL) has even noticed bitcoin, taking steps to block all bitcoin apps from the App Store. Some speculate that this means Apple will enter the payments industry like JPMorgan clearly wants to, so it is blocking bitcoin apps as a way to clear the path for its own digital payment system. Others aren’t so sure about that.
But whatever the future of bitcoins holds, regulators will undoubtedly have a say. China and Korea have already taken a stand on the matter, and others will surely follow.