Bank of Japan emphasizes stablecoin importance

Bank of Japan Deputy Governor addresses the importance of adapting to the ever-changing financial climate, particularly with the emergence of stablecoins in the global economy.

On Oct. 21, Bank of Japan Deputy Governor Ryozo Himino said to Reuters that he believes stablecoins would hold an important role within the global payment system. Therefore, he emphasized the importance of adopting stablecoins amidst the current financial situation.

Not only that, Himino also predicted that stablecoins would grow to one day partially replace the function of bank deposits. This is because unlike traditional bank deposits, stablecoins offer customers faster settlement, lower fees, and around-the-clock transfer capability. Such mechanisms are beyond the capabilities of traditional banks and legacy systems like SWIFT or ACH.

It is possible that Himino’s positive sentiment towards stablecoins may reflect a broader acceptance among central bank officials as he urged for global regulators to start adapting “new realities” in the financial system.

The Bank of Japan Deputy Governor mentioned the emergence of stablecoins and the increasing ratio of assets held by non-bank financial institutions as examples of how rapidly the global financial systems are changing.

In his speech at the 2025 GZERO Summit Japan, Himino called for G20 major economies to seriously commit to implement Basel 3 regulations on the banking system, a process that he claims has been repeatedly delayed by governments time and again. Most recently, countries like Singapore and some parts of the EU have reportedly delayed implementation of Basel 3’s rules on crypto and banking.

“Regulators are doing a lot in these spheres, but much more needs to be done,” said Himino.

“We need to continue to modernize international prudential standards to keep up with the new and emerging realities,” he continued.

Japanese regulators have showed signs of easing government frameworks to better accommodate for emerging technologies in the nation’s financial system. In February 2025, the Japanese Financial Services Agency green lit a report detailing reforms that would ease crypto regulations related to stablecoin issuance and crypto brokerage.

Bank of Japan signal: Are banks growing bullish on stablecoin?

Even before the Bank of Japan expressed support towards stablecoins, a number of major banking institutions have started making moves to issue yen-pegged stablecoins to compete with the dominance of the U.S dollar.

Earlier this month, three of the largest Japanese financial institutions have teamed up with plans to launch a stablecoin pegged to the Japanese yen. The collaboration involves Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group.

In addition, the joint-venture would also aim to create a single platform for stablecoin payments. The platform would serve to streamline settlement processes and lower costs for businesses by enabling smoother, cross-border transactions. The stablecoin issuance and governance for the project would be managed by MUFG’s blockchain infrastructure Progmat.

One of the banks involved in the project, SMBC, has also made plans to launch a stablecoin backed by crypto projects Avalanche and Fireblocks. The partnership aims to conduct trials for the new stablecoin project in the fourth quarter of 2025 or early 2026.

In August 2025, Japanese financial services company Monex Group expressed an interest in launching a yen-pegged stablecoin. However, no concrete plans have been made as of late aside from plans to back the assets using Japanese government bonds.

On the other hand, Japan’s FSA has previously approved the first yen-pegged stablecoin issued by fintech startup JPYC. The stablecoin, dubbed JPYC, is expected to make its roll-out the first official digital currency tied to the local currency.