JP Morgan Chase has renewed a U.S. patent titled "Method and system for processing Internet payments using the electronic funds transfer network," and while that may sound a lot like the way you currently pay for things online using systems like PayPal, it's not.
JPM is imagining a future in which we'll be using "virtual cash" to make and receive payments, and the currency itself will be secure and anonymized. This sounds a lot like Bitcoin and other cryptocurrencies.
The system is also two-way, which suggests that JPM is betting that soon we'll be paid in something like Bitcoin. But not immediately. The patent's introduction notes:
While new Internet payment mechanisms have been rapidly emerging, consumers and merchants have been happily conducting a growing volume of commerce using basic credit card functionality. None of the emerging efforts to date have gotten more than a toehold in the market place and momentum continues to build in favor of credit cards.
That's something we can't deny—everyone from Facebook to PayPal has been trying to reinvent how we spend and access money, but none of them have achieved a revolution yet. JPM guesses the credit card will remain the top dog for at least five years, but then cede its lead to digital money.
JPM initially filed this patent some time ago, but the fact it's renewed it is very interesting—even though the bank is reported as saying it has "no plans" to launch a currency to rival Bitcoin and doesn't have anything in development. Of course it doesn't. Its patent is a protective one, and says JPM has been watching how Bitcoins have evolved and sees a future for this kind of payment. Five years as a limit for credit cards is also very soon if you think about it.
[Image: Flickr user Chris Potter]