Three leading banks in Japan are reportedly collaborating on the issuance of a yen-pegged stablecoin, aimed at enhancing the use of cryptocurrency within the nation’s financial framework.
According to a report from Nikkei, Mitsubishi UFJ Financial Group (MUFG), Bank Sumitomo Mitsui Banking Corp. (SMBC), and Mizuho Bank are joining forces to streamline corporate settlements and lower transaction costs by utilizing the stablecoin, which will be established on MUFG’s Progmat platform.
The banking consortium, serving over 300,000 corporate clients, plans to create a uniform standard for the token to facilitate seamless payments between businesses. They are optimistic about launching the stablecoin by the end of this year.
Mitsubishi Corp. will be the first to apply this stablecoin for internal transactions, aiming to simplify international operations including dividends, acquisitions, and customer dealings.
If the initiative succeeds, it could establish Japan’s inaugural bank-supported stablecoin network under a cohesive framework.
MUFG Unveils the Progmat Platform
The announcement follows MUFG’s release of the “Progmat Coin” stablecoin issuance platform last June, which is intended for use by Japanese banks to create yen-pegged stablecoins across various public blockchain networks.
MUFG indicated plans to expand Progmat Coin for issuing bank-supported stablecoins on Ethereum, Polygon, Avalanche, and Cosmos, with intentions to incorporate further networks in the future.
On September 26, Binance Japan partnered with Mitsubishi UFJ Trust and Banking Corp. (MUTB) to explore the potential of stablecoin issuance leveraging the Progmat Coin.
Binance Japan’s general manager, Takeshi Chino, remarked that stablecoins play a crucial role within the wider financial ecosystem and are pivotal for the advancement of Web3.
Intensifying Competition in Japan’s Stablecoin Sector
The efforts of these banks come amidst a growing institutional shift towards yen-pegged digital assets. In August, it was reported that Japan’s Financial Services Agency (FSA) was preparing to approve yen-based stablecoin issuance, with fintech firm JPYC leading the charge. Furthermore, financial services provider Monex Group is contemplating its own yen-pegged stablecoin initiative, with chairman Oki Matsumoto expressing concerns about being left behind amidst the evolving landscape.
