JPMorgan to Accept Bitcoin and Ethereum as Loan Collateral, Cementing Crypto’s Place in Global Finance

• JPMorgan to accept Bitcoin and Ethereum as loan collateral for institutional clients.

• The current bull run, a pro-crypto U.S. administration, and ETF approvals have “massively legitimized” digital assets as collateral.

Since Donald Trump’s election, the crypto space has undergone massive change. With a pro-crypto administration, institutions, including banks, have embraced crypto as a legitimate financial asset. In recent development, JPMorgan to accept Bitcoin and Ethereum as loan collateral.

JPMorgan to Accept Bitcoin and Ethereum as Loan Collateral

In a landmark decision for global banking, JPMorgan Chase & Co. plans to allow its institutional clients to use Bitcoin (BTC) and Ethereum (ETH) as collateral for loans by the end of 2025. The initiative, to be rolled out globally, will rely on a third-party custodian to securely manage pledged digital assets.

The news sparked an immediate market reaction: Bitcoin surged 2%, reclaiming the $110,000 mark, while Ether rose 3% to approach $4,000, reflecting renewed optimism in institutional adoption.

This new lending program expands on JPMorgan’s June 2025 decision to accept Bitcoin ETFs, including BlackRock’s IBIT fund, as collateral. But this time, the difference is crucial: the bank will now lend directly against the underlying crypto assets, not their ETF derivatives.

A Shift in Wall Street’s Crypto Strategy

By allowing clients to leverage BTC and ETH directly, JPMorgan is signaling confidence that it can effectively manage crypto’s volatility risk, an area that has historically kept major lenders cautious.

While CEO Jamie Dimon has long been a vocal skeptic of cryptocurrencies, once calling Bitcoin a “hyped-up fraud” and even suggesting the U.S. government should “shut it down,” his stance has softened notably.

At JPMorgan’s May investor conference, Dimon compared Bitcoin to cigarettes:

“I don’t think we should smoke, but I defend your right to smoke. I defend your right to buy Bitcoin.”

That remark, though cautious, marks a dramatic evolution for one of Wall Street’s most influential figures and for a bank managing over $4.5 trillion in assets.

Institutional Demand and Regulatory Green Lights

JPMorgan’s move reflects a surge in institutional demand for crypto-backed financial products, driven by a more favorable regulatory climate.

Over the past year, U.S. regulators have rolled back several restrictive guidelines that previously limited banks’ exposure to digital assets.

In March, the Office of the Comptroller of the Currency (OCC) rescinded earlier restrictions on crypto.

In April, both the Federal Reserve and the FDIC withdrew warnings about crypto-related liquidity risks, clearing the way for banks to include digital holdings in secured lending activities.

Other banks have quickly followed suit. Goldman Sachs has accepted Bitcoin as collateral since 2022, while State Street, BNY Mellon, Morgan Stanley, and Fidelity continue expanding their custody and trading services for crypto clients.

Why Bitcoin-Backed Loans Are Rising

The concept of lending against Bitcoin is not new, but it has matured significantly. John Glover, CIO of crypto lender Ledn, recently noted that a combination of factors, including the current bull run, a pro-crypto U.S. administration, and ETF approvals, has “massively legitimized” digital assets as collateral.

“With Bitcoin being the biggest, most secure crypto, it’s natural that demand for BTC-backed loans continues to grow,”

Glover said.

As institutions increasingly view crypto as a legitimate financial instrument, Bitcoin and Ethereum are becoming essential tools for liquidity management, not just speculative assets.

JPMorgan’s Expanding Crypto Ecosystem

Beyond collateralized loans, JPMorgan has been steadily deepening its involvement in blockchain technology:

In June, it filed a trademark for JPMD, a digital deposit token fully backed by U.S. dollars, now live on Coinbase’s Base network.

In July, the bank began testing a blockchain-based carbon credit trading platform developed with S&P Global Commodity Insights and EcoRegistry.

These initiatives demonstrate how the world’s largest bank is weaving digital assets into its broader strategy not as a speculative play, but as an infrastructure upgrade to modernize financial markets.

The Bigger Picture: Crypto and Traditional Finance Converge

The acceptance of Bitcoin and Ethereum as loan collateral represents more than a banking milestone it’s a clear sign that crypto is no longer an outsider in global finance.

Once dismissed by Dimon and other Wall Street titans, Bitcoin is now being treated with the same institutional credibility as stocks, bonds, and gold.

As Morgan Stanley prepares to launch retail crypto trading through E*Trade in early 2026 and Fidelity expands its crypto custody, it’s evident that digital assets are becoming fully integrated into the financial mainstream.

With over $4 trillion in managed assets, JPMorgan’s global crypto collateral program may well mark the moment where digital assets finally gain equal footing with traditional forms of wealth in international finance.