Japan’s top banks join forces to issue first yen-pegged stablecoin: report

Japan’s largest financial institutions have joined forces to launch a stablecoin pegged to the yen and US dollar, aiming to revolutionize cross-border payments and streamline financial processes.

Japan’s leading financial institutions, Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group, are said to be collaborating to issue a stablecoin pegged to the Japanese yen, a major development in the country’s digital currency sector. 

According to a local report on Oct. 17, the new stablecoin will also be pegged to the U.S. dollar, and the coins will initially be used for settlement by Mitsubishi Corporation.

The three megabanks, with over 300,000 business partners, are working together to drive the local adoption of stablecoins. The goal of the initiative is to create a single platform for stablecoin payments, which will streamline settlement processes and lower costs for businesses by enabling smoother, cross-border transactions, making payment processes more efficient.

MUFG’s Progmat to lead Japan’s stablecoin push

At the center of this plan is Progmat, a blockchain infrastructure platform created by MUFG. Progmat will be responsible for the development of digital financial products that comply with regulatory standards.

Through Progmat, the stablecoin issuance and governance will be managed, ensuring that the project aligns with legal requirements and operational compliance. This adds a layer of trust and reliability to the venture, paving the way for the stablecoin’s acceptance in global markets.

Meanwhile, the latest collaboration forms part of Japan’s broader push to modernize cross-border payments and secure its position in the global digital currency space. 

An earlier report had revealed that Japan’s FSA was set to approve the first yen-denominated stablecoin, issued by fintech firm JPYC. However, approval is still on the pipeline. With the FSA already easing stablecoin regulations, the latest collaboration between major banks signals the nation’s readiness to join Hong Kong, South Korea, and China in fueling Asia’s growing crypto revolution.