A sign outside the headquarters of JP Morgan Chase & Co in New York, September 19, 2013. REUTERS/Mike Segar

(Reuters) - JPMorgan Chase is partnering with start-up Digital Asset Holdings to launch a trial project using blockchain technology that could reduce the cost and complexity of trading, the Financial Times reported on Sunday.

The agreement comes as another sign that blockchain, which is best known as the basis of the digital currency Bitcoin, has wide-ranging applications for some of Wall Street’s biggest banks.

One potential use for the technology is addressing liquidity mismatches in some of JPMorgan’s loan funds, the Financial Times said.

“To sell a loan is a very cumbersome, time-consuming process; settlement can take weeks,” Daniel Pinto, head of JPMorgan’s investment bank, told the Financial Times. It “makes all the sense in the world” to explore blockchain’s potential to improve that process.

Digital Asset Holdings is run by Blythe Masters, JPMorgan’s former head of commodities.