JPMorgan adds Metaverse to its banking channels

  • JPMorgan has established a presence in the virtual world based on the Decentraland blockchain.
  • The move underscores JPMorgan’s ambition to modernize its brand by keeping abreast of market trends and targeting a younger customer base.
  • Insider Intelligence publishes hundreds of banking industry insights, charts and forecasts. Learn more about becoming a customer.

The news: JPMorgan has opened a living room in the virtual world based on the Decentraland blockchain and claims to be the first major lender to enter the metaverse.

Chart showing attitudes towards the digital metaverse among UK and US internet users

Insider information

The Onyx Lounge is named after JPMorgan’s Onyx blockchain unit, which offers a suite of Ethereum-based services.

More on this: Gadgets at the investment bank’s new virtual trade show include a roaming tiger welcoming visitors and a portrait of CEO Jamie Dimon.

The news coincides with the release of a JPMorgan report on metaverse-related growth opportunities in which it:

  • Labels the metaverse market opportunity at “over $1 trillion in annual revenue”.
  • Points out that the average price of virtual land doubled from $6,000 to $12,000 over six months last year.
  • Acknowledges “explosive interest in the metaverse”.
  • Predicted that the metaverse would “accelerate the shift” from cash to crypto.

Publicity stunt or signal of intent? The move underscores JPMorgan’s ambition to modernize its brand by keeping abreast of market trends and targeting a younger customer base.

The banking giant said the risk “of being left behind is worth the extra investment needed to jump in” in the race to build a presence in the metaverse.

But the tangibility of JPMorgan’s new metaverse presence seems negligible to its clients:

  • No banking services are currently offered.
  • Decentraland’s reach is minimal. It only has around 300,000 monthly active users and only 18,000 daily users, according to Yahoo Finance, although those numbers are growing rapidly.

What’s next for the banking metaverse?

More investment banks will enter the metaverse: While no other major incumbent bank has dipped their toes into the metaverse, some have recently spoken of its enormous potential. Morgan Stanley estimated the future market value of the metaverse in China at $8 trillion, the same amount Goldman Sachs projected for the global market.

Bank branches are here to stay: Consumers still expect 39% of their banking activities to involve direct human assistance by 2024. The number of bank branches may be down, but if expectations customers towards them remain, they will not disappear completely.

Consumers wary of virtual banking: About 20% to 30% of people cite concerns about data security and fraud as reasons for not going digital-only with their banking services. The Metaverse itself is unlikely to allay concerns, as 50% of people worry that it’s too easy for hackers to impersonate others.

The big takeaway: It’s hard to tell if JPMorgan’s metaverse entry is the start of a serious push toward virtual banking or just hot air.

But it won’t be the last big bank to jump into the space as the metaverse goes mainstream and corporate fear of missing out sparks interest.

Want to read more stories like this? Here’s how you can access it:

  1. Join other Insider Intelligence customers who receive forecasts, briefings, charts and banking research reports in their inbox every day. >> Become a customer
  2. Explore related topics in more depth. >> Browse our coverage

Current subscribers can access the entire Insider Intelligence content archive here.


About Author

Comments are closed.