Tokyo-based fintech company JPYC has launched Japan’s first yen-backed stablecoin and new coin issuance platform as global competition intensifies to corner the growing market.
The Japanese yen stablecoin JPYC went live on Monday and is backed 1:1 by bank deposits and government bonds, and has a 1:1 exchange rate with the yen, the company announced on Friday.
According to a report from Business Insider Japan, JPYC President Noriyoshi Okabe said at a press conference in Tokyo that the company’s stablecoin is a “major milestone in the history of Japanese currency” and has also attracted interest from seven companies planning to introduce it.
JPYC’s launch comes amid explosive growth in the global stablecoin market, dominated by dollar-linked assets such as USDT (USDT) and Circle’s (USDC), with a market capitalization of over $308 billion. USD stablecoins have already established a foothold in Japan, with Circle launching USDC in Japan on March 26th.
Launch of stablecoin platform
Along with the stablecoin, the company also launched JPYC EX, a dedicated platform created for the issuance and redemption of tokens that is governed by strict identity verification and transaction verification under the Act on Prevention of Transfer of Criminal Proceeds.
Users can deposit Japanese yen into their account via bank transfer, receive JPYC to their registered wallet address, and receive a refund in yen to their withdrawal account.
In the long term, JPYC says, “We would like to achieve an outstanding balance of 10 trillion yen over the next three years and take on the challenge of building a new social infrastructure using stable coins.”
Japan’s stablecoin market may soon see other competitors
JPYC may not be the only company holding stablecoins for a long time. Tokyo-based financial services company Monex Group announced in August that it plans to issue a stablecoin pegged to the Japanese yen.
Related: Financial giant Western Union introduces remittance using stable coins on a trial basis
Japan’s three largest banks, Mitsubishi UFJ Financial Group, Sumitomo Mitsui Banking Corporation, and Mizuho Bank, also want to jointly issue yen-pegged stablecoins on MUFG’s stablecoin issuance platform, Progmat.
At the same time, Japan’s Financial Services Agency may be preparing to review regulations that would allow banks to acquire and hold cryptocurrencies such as Bitcoin (BTC) for investment purposes.
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