JPMorgan Allows Bitcoin and Ether as Loan Collateral

TLDR

• JPMorgan plans to allow Bitcoin and Ether as collateral by 2025.
• Loan-to-value ratios for crypto holdings may reach 70%.
• Third-party custodians will manage cryptocurrency storage securely.

JPMorgan Chase & Co. plans to allow institutional clients to use Bitcoin (BTC) and Ether (ETH) as collateral for loans. This strategy is expected to be available by the end of 2025. The program is designed to cater to the growing demand from institutional investors seeking liquidity options without selling their cryptocurrency holdings.

The move follows JPMorgan’s policy of mid-2025, where the bank began accepting crypto-linked exchange-traded funds (ETFs) as collateral. These included products such as BlackRock’s IBIT, Fidelity’s FBTC, and Grayscale’s GBTC. This approach allows loan-to-value ratios up to 25% for ETFs and potentially between 50%-70% for direct cryptocurrency holdings.

Program Goals and Executive Perspectives

The initiative is primarily led by JPMorgan executives under the guidance of CEO Jamie Dimon. Dimon, who has served as CEO since 2006, once called Bitcoin a “hyped-up fraud.” However, he has since expressed a more open stance, stating, “I defend your right to buy Bitcoin – go at it.” Despite the initial skepticism, the bank is resuming its Bitcoin-backed lending efforts, which had been paused in 2022 due to regulatory uncertainty.

Though direct statements from Jamie Dimon or other JPMorgan executives have not been made available, reports indicate that the decision aligns with newfound regulatory clarity and significant client demand. Anonymous sources familiar with the matter also support these developments. Official JPMorgan channels, including Twitter and LinkedIn, have not released statements regarding this program.

Collateral Management and Custodians

Assets affected by this program are primarily Bitcoin and Ether. Institutional clients will be able to pledge these holdings to secure loans in U.S. dollars. For security, third-party custodians such as Coinbase Custody will be responsible for managing the cryptocurrency storage. No plans to include altcoins or other assets are reported at this stage.

No specific financial data, such as allocated funding or new institutional investments, have been disclosed. The main focus remains on providing liquidity solutions for hedge funds and family offices without liquidating their crypto positions. This aligns with JPMorgan’s ongoing practices regarding ETF collateral.

Historical Context and Competitive Landscape

JPMorgan’s recent activities mirror its past financial services expansions. Earlier, in June 2025, the bank started offering loans backed by crypto ETFs. Similar activities have been seen with other financial institutions such as Morgan Stanley, BNY Mellon, State Street, and Fidelity, whereby they expanded custody and trading services. These initiatives helped normalize cryptocurrency use on Wall Street, especially during favorable regulatory conditions.

For more information, potential borrowers and financial observers can learn about this development here.

Market Reactions and Other Developments

While the cryptocurrency community has been buzzing with speculation, no significant public comments have been observed from sector influencers such as Arthur Hayes or Raoul Pal. A notable tweet summarizing the announcement stated, “NEW: JPMORGAN PLANS TO ALLOW INSTITUTIONAL CLIENTS TO USE BITCOIN AND ETHER AS COLLATERAL FOR LOANS BY THE END OF THE YEAR – PER BLOOMBERG SOURCES.”