Author: Martin Young, Cointelegraph; Translator: Song Xue, LianGuai
Cryptocurrency exchange Binance is collaborating with Mitsubishi UFJ Trust and Banking Corporation (MUTB), Japan’s largest bank, to explore the issuance of stablecoins in Japan.
On September 25th, Binance Japan announced a joint research initiative aimed at issuing yen and other legal stablecoins to accelerate the adoption of Web3 in Japan. The two companies plan to utilize MUFG’s stablecoin issuance platform, Progmat Coin, for the research.
The Japanese bank will be the first to develop the Progmat Coin platform, serving as the infrastructure for issuing stablecoins based on the recently revised and implemented Payment Services Act in Japan. This legislation came into effect in June, allowing Japanese banks and regulated cryptocurrency providers to issue stablecoins.
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Binance Progmat logo. Source: Binance PR
In a statement, Binance stated that the platform currently supports stablecoin issuance on Ethereum but may expand to include BNB Chain through collaboration with Binance.
Takeshi Chino, General Manager of Binance Japan, stated in a statement that stablecoins are crucial for a broader financial ecosystem. He added that besides providing low-cost and instant cross-border trade settlements for businesses, they also offer seamless cryptocurrency trading for retail investors.
Stablecoins fulfill important financial service needs and are vital for the successful adoption of Web3.
Tatsuya Saito, Deputy General Manager of MUFG Products, stated that the Japanese stablecoin market has the potential to grow to 34 billion USD (5 trillion JPY). According to CoinGecko, this represents around 27% of the current estimated global market value of 123.7 billion USD.
Binance faced significant regulatory pressure in the West and began offering services in the Japanese market in August 2023, providing 34 types of tokens.
Meanwhile, it is reported that Bank of Orix in Japan is also considering plans to issue stablecoins in the country.
Orix plans to start testing yen, USD, and other stable currencies in October and launch them in 2024. These stablecoins will be backed by fiat currency deposits and utilize the JaLianGuain Open Chain blockchain developed by G.U. Technologies and its partners in Tokyo.
Japan seems ready to introduce stablecoins for the payment sector. In August, there were reports that Japanese blockchain startup Soramitsu is exploring a new stablecoin exchange for cross-border payment systems in Asian countries.
It is also reported that earlier this month, the Japanese government planned to allow startups to raise public funds through the issuance of crypto assets and stablecoins.
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