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Japan’s three largest banks — MUFG, SMFG, and Mizuho Financial Group — plan to launch a yen-backed stablecoin with support from the country’s Financial Services Agency, marking one of the first regulated stablecoin initiatives by major traditional banks. The digital currency will maintain a 1:1 peg to the yen and run on MUFG’s Progmat blockchain platform, with a potential launch targeted for early 2026.
Japan’s revised Payment Services Act now allows licensed banks and trust companies to issue stablecoins fully backed by fiat currency, offering a legal framework that promotes transparency and investor protection.
MUFG’s Progmat platform, originally designed for tokenized securities, will serve as the foundation for this yen-backed stablecoin project. According to MUFG officials, Progmat now includes compliance tools that align with Japan’s strict regulatory standards for digital assets.
Ryozo Himino, Deputy Governor of the Bank of Japan (BOJ), praised the innovation while urging careful regulatory oversight.
“Each country makes its own financial system resilient for its own sake. It is also in every country’s interest for other financial systems to remain resilient,” Himino noted, highlighting the importance of balance between innovation and financial stability.
Industry analysts believe that early adoption of the yen-backed stablecoin will focus on corporate clients and exporters, enabling faster, cheaper settlements for global trade and finance.
Meanwhile, startup JPYC has launched the world’s first-ever yen-backed stablecoin, backed by Japanese government bonds and domestic savings. CEO Noritaka Okabe said, “Our mission is to lower transaction costs and empower startups to innovate with digital money.”
However, Tomoyuki Shimoda, a former BOJ executive, expressed skepticism, stating that yen-backed stablecoins might face slower adoption than those pegged to the U.S. dollar, given global liquidity dynamics.
Japan’s regulatory clarity is now attracting major financial players. SBI and Ripple are reportedly planning to introduce their own yen-backed stablecoin called RLUSD by early 2026, while Japan Post Bank intends to launch DCJPY, a tokenized yen deposit, within the same period.
The BOJ has repeatedly emphasized that stablecoins can enhance payment efficiency, enabling instant, low-cost value transfers. Deputy Governor Himino reiterated that “regulatory standards must evolve with market innovation,” warning that “political momentum has an expiry date.”
Japan is making a bold leap into the future of finance with its groundbreaking yen-backed stablecoin project, set to be launched by the nation’s three megabanks — MUFG, SMFG, and Mizuho Financial Group.
Backed by the Financial Services Agency (FSA), this ambitious move signals a new chapter in Japan’s digital transformation as it aims to modernize payments and redefine cross-border transactions.
With full regulatory support and a 1:1 yen peg, this yen-backed stablecoin could revolutionize the nation’s banking system and reshape global financial innovation.
As Japan’s megabanks move forward with their yen-backed stablecoin, analysts expect the project to accelerate the nation’s digital payment revolution, potentially reshaping Asia’s financial landscape. With government support, legal clarity, and strong corporate backing, the yen-backed stablecoin initiative could position Japan as a global leader in compliant digital finance.
Japan’s bold leap into digital finance with its yen-backed stablecoin initiative marks a defining shift in the country’s economic strategy. Backed by three megabanks — MUFG, SMFG, and Mizuho — the move signals Japan’s determination to compete on the global fintech stage.
The Financial Services Agency’s approval cements this as more than an experiment; it’s a national strategy to redefine payments, reduce reliance on cash, and strengthen Japan’s influence in the rapidly evolving digital currency ecosystem.
Megabanks to Launch Powerful Yen-Backed Stablecoin Initiative is more than a financial experiment—it’s a strategic statement about Japan’s future in the global digital economy. With full regulatory backing and participation from the nation’s largest banks, the yen-backed stablecoin could become a benchmark for trust, speed, and compliance in digital payments.
Analysts predict that if successful, Japan’s model may inspire other economies to follow suit, ushering in a new age of transparent, government-backed digital currencies that bridge traditional banking and blockchain-powered innovation.
