Overview

• Starting in the coming weeks, JPMorgan Chase will let trading and wealth-management clients use shares of BlackRock’s iShares Bitcoin Trust as collateral for loans.
• The bank will begin counting approved crypto holdings toward certain clients’ net worth and liquidity assessments.
• CEO Jamie Dimon’s reversal follows his recent announcement that the bank would allow clients to buy bitcoin after long criticizing digital assets.
• Industry observers expect the move to prompt other Wall Street firms to extend similar collateral policies for Bitcoin ETFs.
• Analysts warn that accepting Bitcoin ETFs as collateral could introduce risks of rehypothecation, highlighting the need for regulatory oversight.