JPMorgan Preparing to Launch Structured Bond Linked to BlackRock IBIT

JH Kim

Summary

JPMorgan said it is preparing to launch a structured bond linked to the performance of BlackRock's Bitcoin ETF IBIT.
Investors' returns will vary with IBIT price movements, and it said the product includes a guaranteed minimum 16% return and principal protection.
JPMorgan said the product reflects institutional demand for IBIT and signals an expansion of its Bitcoin-based financial products line.

JPMorgan Chase is preparing to launch a structured bond linked to the performance of BlackRock's Bitcoin (BTC) ETF IBIT. It is a derivative-type product that guarantees a minimum return while allowing returns to vary according to IBIT price fluctuations.

On the 25th (local time), crypto media The Block reported that JPMorgan submitted a prospectus to the U.S. Securities and Exchange Commission (SEC) for a new structured bond with IBIT as the underlying asset. The product is broadly structured into a 1-year automatic early redemption (auto-call) scenario and a scenario maturing in 2028.

According to the prospectus, if the 1-year auto-call condition is met, a minimum fixed return of 16% is guaranteed regardless of market conditions. It also includes a protective mechanism that prevents principal loss even if the IBIT price falls by up to 30%. However, there is a cap on returns, and if IBIT falls by more than 30%, principal loss will occur.

The product is designed to reflect IBIT's high market recognition and institutional demand, and is interpreted as a signal that JPMorgan is expanding its line of Bitcoin-based financial products.