Three of Japan’s largest banks are reportedly planning to jointly issue a yen-pegged stablecoin, contributing to the region’s growing adoption of crypto technology in its financial infrastructure.
Nikkei reported on Friday that Mitsubishi UFJ Financial Group (MUFG), Bank Sumitomo Mitsui Banking Corp. (SMBC) and Mizuho Bank plan to modernize corporate settlements and reduce transaction costs using a yen-based stablecoin project built on MUFG’s stablecoin issuance platform Progmat.
The banks, which collectively serve more than 300,000 corporate clients, aim to standardize the token to make it interoperable for payments within and between companies. The consortium expects to roll out the stablecoin by the end of the year.
Mitsubishi Corporation will be the first entity to implement the stablecoin for internal settlements. With over 240 subsidiaries globally, the company aims to streamline international transfers on dividends, acquisitions and customer transactions, saving on fees and administrative burdens.
If successful, the project could establish Japan’s first bank-backed stablecoin network under a unified framework
Cointelegraph reached out to MUFG, SMBC and Mizuho for comments, but had not received a response by publication.
MUFG launched the Progmat stablecoin platform in June
The news follows the launch of MUFG’s stablecoin issuance platform “Progmat Coin.” In June, MUFG said the platform will be used by banks in Japan to issue yen-pegged stablecoins on several public blockchain networks.
MUFG said at the time that Progmat Coin will be used to facilitate the issuance of bank-backed stablecoins on Ethereum, Polygon, Avalanche and Cosmos. The bank said it plans to add more networks in the future.
On Sept. 26, Binance Japan teamed up with Mitsubishi UFJ Trust and Banking Corporation (MUTB) to explore the issuance of stablecoins using Progmat Coin.
Binance Japan general manager Takeshi Chino said stablecoins are crucial for the broader financial ecosystem and that these assets will fill an important role in financial services and are vital for Web3 adoption.
Related: Nomura moves to capture Japan’s booming institutional crypto market
Japan stablecoin race intensifies
The banks’ stablecoin efforts follow institutional momentum on yen-pegged crypto assets.
In August, Nikkei reported that Japan’s Financial Services Agency (FSA) is preparing to approve the issuance of yen-based stablecoins. The report said that the Tokyo-based fintech firm JPYC will lead the stablecoin rollout.
In the same month, the Tokyo-based financial services firm Monex Group also announced that it was considering launching a stablecoin pegged to the Japanese yen.
As Cointelegraph previously reported, Monex Chairman Oki Matsumoto said the company risked being left behind if it didn’t move into stablecoins. However, he also acknowledged that issuance may require significant infrastructure and capital.
Magazine: Binance shakes up Korea, Morgan Stanley’s security tokens in Japan: Asia Express
