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JPMorgan is in advance talks of investing $20 million in ConsenSys thereby pushing ahead the merger of its Ethereum-based Quorum to ConsenSys.
Since the beginning of 2020, the Wall Street banking giant JPMorgan has been thinking of moving its enterprise-grade open-source Quorum blockchain to ConsenSys. It seems like the deal is now closer to realization,
As per The Block, JPMorgan is in advanced discussions of a $50 million fundraise for ConsenSys. Sources familiar with the matter told the publication that JPMorgan is looking to invest $20 million leading the fundraising. This deal will see the merger of Ethereum-based Quorum to ConsenSys with the latter taking over its maintenance and support.
Currently, JPMorgan’s Quorum blockchain uses the Ethereum blockchain network internally. With over 300 member banks, the Quorum platform operates the Interbank Information Network (IIN). The Quorum blockchain uses JPMorgan’s native cryptocurrency dubbed JPM Coin announced in early 2019. The JPM Coin is only used for big-value cross-border payment settlements.
If the deal proceeds further, it will also help JPMorgan to alleviate its cash woes. Earlier this year in April 2020, the company had to cut its staff by 14% amid the global slowdown. A year back, ConsenSys was also planning to raise $200 million as part of its restructuring plans. Post the spin-off from Quorum to ConsenSys, both the IIN and JPM Coin will continue to operate in the same manner.
JPMorgan and Consensys: Focus on Enterprise-Grade Blockchain Solutions
Joe Lubin – one of Ethereum’s co-founders and original backers of the project – founded ConsenSys a few years back. Lubin started this firm by funding it through its own Ethereum wealth. The company majorly focuses on providing enterprise blockchain consulting and solutions. Moreover, it also focuses for developing products for the Ethereum blockchain network.
In the past, ConsenSys has also worked on some big enterprise projects and implementations that use Quorum technology. Some of the world’s biggest agri-business companies are using the Quorum and ConsenSys platforms.
Previously, ConsenSys had also incubated projects like PegaSys by using the open-source enterprise blockchain Hyperledger Besu. Now with ConsenSys’ close proximity to Quorum, there’s some possibility of having close synergies between Quorum and Besu.
Apart from ConsenSys, a number of other big players like EY and Microsoft are working on protocols that encourage the adoption of the Ethereum blockchain. It will interesting to see further developments with the JPMorgan-ConsenSys deal.