Three major Japanese banks are planning to launch a yen-backed stablecoin by March 2027, aiming to create a joint operational framework.
Three major Japanese banks are set to join forces to create a stablecoin, aiming for a launch by March 2027.
Collaboration Among Major Financial Institutions
Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group are collaborating on this initiative, as announced by MUFG. The institutions will establish a council to explore the necessary operational frameworks for the stablecoin.
The banks will act as "joint settlors," while a trust bank or another similar organization will fulfill the role of trustee.
The Financial Services Agency (FSA) of Japan expressed backing for this stablecoin project last November. Recently, the ruling Liberal Democratic Party (LDP) has also pushed for the development of yen-based stablecoins.
Stablecoins function as digital currencies designed to maintain a stable value, often linked to traditional assets like fiat currencies. Currently, the market is heavily dominated by U.S. dollar-pegged coins, such as Tether's USDT and Circle's USDC, which together account for 84% of the total market share. In contrast, yen-pegged tokens represent a small fraction of the market, valued at under $50 million within a $311 billion industry, with JPYC being the most significant at around $18 million in market capitalization.
