Dive Brief:
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JPMorgan Chase plans to merge its blockchain unit Quorum with Brooklyn, N.Y.-based developer ConsenSys, sources told Reuters.
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The deal is likely to be announced in the next six months, according to people familiar with the matter. JPMorgan’s Quorum team is made up of about 25 people globally.
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The plan after the merger is to maintain the Quorum brand, a source said. Financial terms of the deal were not disclosed.
Dive Insight:
JPMorgan Chase uses Quorum, which it built internally on the Ethereum network, to power its blockchain-based Interbank Information Network (IIN).
The country’s largest bank launched IIN as a pilot program in 2017, with an eye toward minimizing friction in cross-border transactions by enabling payments to reach beneficiaries faster and with fewer steps.
JPMorgan said 397 banks use its blockchain network.
JPMorgan said it wants to eventually employ Quorum to issue JPM Coin, the bank’s digital currency, which it plans to use to settle interbank transfers.
A merger with ConsenSys would have no impact on the IIN or other JPMorgan projects running on Quorum, sources said.
JPMorgan reportedly had been considering spinning off Quorum for up to two years. ConsenSys was likely chosen as a partner because of its previous work with JPMorgan, Reuters reported, and for its expertise with Ethereum — ConsenSys was founded by Joe Lubin, one of Ethereum's co-founders.
ConsenSys announced last week that it laid off 14% of its workforce as part of a restructuring to separate its software development work from its venture activities.
