Japan’s largest financial institutions, Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho, are joining forces to launch yen- and dollar-backed stablecoins in a direct challenge to USDT and USDC’s global dominance.
According to Nikkei, Mitsubishi UFJ will pilot the yen-pegged coin for corporate settlements, while the group aims to issue up to 1 trillion yen ($6.64 billion) in stablecoins over the next three years. Together, the banks serve more than 300,000 corporate clients, positioning Japan for one of the most ambitious stablecoin rollouts to date.
The effort is powered by Progmat, a blockchain platform built by MUFG to issue and govern compliant digital assets. The banks have also partnered with Bitbank, Ava Labs, and Fireblocks to expand usage across Japan’s crypto ecosystem.
The new yen-backed stablecoin, JPYC, will maintain its peg through reserves held in deposits and government bonds, targeting use cases such as cross-border corporate payments, student remittances, and DeFi participation.
The move coincides with Japan’s updated 2023 stablecoin framework, which restricts issuance to licensed financial institutions, signaling a clear strategy to build regulated alternatives to dollar-backed coins.
Japan’s crypto adoption has surged 120% year-over-year, per Chainalysis, led by rising demand for JPY-based assets. XRP remains the top traded asset in Japan, with over $21.7 billion in activity, followed by Bitcoin and Ethereum.
Only Circle’s USDC currently has regulatory approval for use in Japan, but with three megabanks now entering the scene, the global stablecoin landscape may be about to change.
Image Credit: Pixabay
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