Kinexys by JP Morgan announced that state-owned Qatar National Bank and Saudi National Bank have adopted its Kinexys Digital Payments (formerly JPM Coin) solution, which provides programmable blockchain-based bank accounts. The latest clients are the largest and third largest banks in the Middle East and North Africa (MENA) respectively. At the same time, JP Morgan said this marks adoption by eight of the largest MENA banks.
“With 8 of the largest banks in MENA using the Kinexys Digital Payments platform, we have an opportunity to fundamentally rewire how multi-currency clearing and settlement infrastructure operates in the region and extend the capabilities more broadly and worldwide,” said Naveen Mallela, Global Co-head of Kinexys by JP Morgan.
So far JP Morgan has only named six of the eight banks, with the other four being First Abu Dhabi Bank, Emirates NBD, Commercial Bank of Dubai and Bahrain’s Bank ABC. Hence, the other two banks are likely amongst the list of top 10 MENA banks, which according to S&P Global and TAB Global comprise:
| Bank | Country |
| Qatar National Bank | Qatar |
| First Abu Dhabi Bank (FAB) | UAE |
| Saudi National Bank | Saudi Arabia |
| Alrajhi Bank | Saudi Arabia |
| Emirates NBD | UAE |
| Bank Leumi | Israel |
| National Bank of Egypt | Egypt |
| Bank Hapoalim | Israel |
| Standard Bank | South Africa |
| Abu Dhabi Commercial Bank | UAE |
Why MENA is first for product-market fit
Using a digital representation of bank money on a DLT allows money to move across jurisdictions instantly and 24/7. What JP Morgan got right was leaning into a critical pain point in order to achieve product market fit. Middle Eastern banks are open on different days compared to the rest of the world, causing massive friction in cross border payments because of opening hour differences. That friction is addressed by enabling 24/7 payments, even before you start looking at enabling programmability.
For new banks, the first step is often moving money between branches and internal treasury management, followed by supporting corporate clients with worldwide money movement.
“We’ve successfully piloted U.S. dollar-denominated flows, and this technology will allow us to scale our existing offering and introduce more cutting-edge and frictionless capabilities to our branches, affiliates and clients going forward,” said Ali Al Shubbar, Head of Treasury Operations and International Operations at Saudi National Bank.
JP Morgan initially launched the blockchain-based bank accounts for 24/7 payments, and more recently added programmability. Bahrain’s Bank ABC was the first to confirm adoption in 2023, followed by First Abu Dhabi Bank, which was an early adopter of the programmability feature. Initially the solution purely supported dollars, but now payments can be made in EUR and GBP. So far the platform has processed around $1.5 trillion in transactions.
Blockchain payments in the Middle East
Meanwhile, Middle Eastern banks are leaning into blockchain-based payments more broadly. Emirates NBD has joined the multi-bank cross border payments network Partior, co-founded by JP Morgan, and FAB is planning its own stablecoin. Later this year the UAE intends to launch a retail and wholesale central bank digital currency (CBDC). The country is already a participant in mBridge the blockchain and CBDC-based cross border payment system that includes the Saudi Central Bank, as well China, Hong Kong and Thailand.
However, JP Morgan leaned into blockchain early, so was there to offer a functional solution before others got off the ground.
Ledger Insights has published a report on the bank adoption of stablecoins, tokenized deposits and DLT payments. In addition to 70 projects, it explores design features, such as how to avoid pitfalls that could limit their longer term potential.