JPMorgan Chase freezes accounts of two stablecoin-linked firms amid risk concerns

JPMorgan Chase has frozen bank accounts connected to two venture-backed stablecoin startups operating in high-risk jurisdictions, citing compliance and risk controls. The affected firms, BlindPay and Kontigo, primarily serve users in Latin America, including Venezuela, a region subject to sanctions and legal restrictions.

According to reports, the accounts were accessed via Checkbook, a payments platform partnered with major banks. Checkbook CEO PJ Gupta said a sharp rise in chargebacks and disputed transactions after rapid customer growth triggered internal risk alerts at JPMorgan, leading to the freeze.

JPMorgan clarified that the action does not reflect a negative stance on stablecoins as a sector, noting it continues to work with stablecoin issuers and related businesses. Kontigo co-founder Jesus Castillo denied allegations of improper activity, including claims of facilitating cross-border transfers without identity checks.

The move comes as regulators and banks closely monitor digital payment activity linked to sanctioned regions. Despite heightened scrutiny, stablecoin adoption continues to gain momentum globally. In the U.S., the Federal Deposit Insurance Corporation has proposed a framework under the GENIUS Act that could allow banks to issue regulated payment stablecoins through subsidiaries.

Internationally, institutions are preparing their own launches, with Sony Bank targeting a dollar-pegged stablecoin by 2026, while Western Union plans a U.S. dollar payment token on the Anchorage Digital Bank platform.