BlackRock moves into Japan’s stablecoin race, signing MOU to connect tokenized funds with SBI’s JPYSC

BlackRock has signed a memorandum of understanding with SBI Holdings and Startale Group to explore connecting tokenized money market funds to JPYSC, a yen-denominated stablecoin, the companies said on October 27. The agreement covers technical, commercial and regulatory work only, and no fund, blockchain network or launch date has been named.

SBI and Startale expand their digital finance ambitions

The collaboration builds on existing work by SBI Holdings and Startale to develop infrastructure for blockchain-based financial markets.

In February, the companies introduced Strium, a blockchain network designed to support the trading of tokenized equities, foreign exchange products and other financial assets. The project reflects their broader interest in connecting conventional financial markets with digital asset infrastructure.

Their stablecoin initiatives have also progressed through JPYSC, which operates under a trust-bank issuance structure. SBI Shinsei Trust Bank handles issuance, while SBI VC Trade provides distribution through the group’s regulated digital asset operations.

More recently, SBI and Startale announced plans to explore interoperability between JPYSC and Open USD. That initiative forms part of SBI’s wider efforts to develop digital payment and settlement infrastructure.

SBI Holdings Chairman and President Yoshitaka Kitao described the transition toward blockchain-based financial services as a global development that Japan must prepare for. He said the shift to onchain finance was becoming an unavoidable trend and that SBI Group would continue developing products and services to support it.

For the proposed Yen stablecoin integration, the distinction between payments and investments will be important. A stablecoin can serve as a digital payment instrument, while tokenized fund shares remain investment products subject to their own terms, risks and regulatory requirements. Bringing them together would require more than simply making both available on a blockchain.

Japan’s stablecoin rules will shape the proposed integration

Japan’s regulatory framework is another central part of the discussions. Amendments to the country’s Payment Services Act established rules for qualifying fiat-linked digital payment instruments, providing a legal structure for regulated stablecoin activity.

However, an established framework does not automatically authorize every proposed application. The companies must still assess the rules governing the distribution of tokenized investment products and their potential use alongside JPYSC.

The MOU identifies regulatory compliance as an area requiring further examination. It does not state that Japanese regulators have approved a combined service or that investors can already use JPYSC to acquire tokenized money market fund shares.

SBI has separately explored stablecoin-based payment applications, including cross-border QR payment testing with partners in South Korea. That work examines how payment instructions, fund transfers and existing merchant systems might operate together, with verification targeted for completion by December 2026.

Those experiments involve different participants and use cases from the BlackRock agreement. They nevertheless illustrate the broader infrastructure questions facing financial institutions seeking to connect digital currencies with established payment systems.

Startale CEO Sota Watanabe described exploring the connection between JPYSC and tokenized money market funds as an important step toward building the foundations of onchain finance. His remarks highlighted the need for Japan to continue developing blockchain infrastructure.

The proposed Yen stablecoin connection will therefore depend on both technical compatibility and the ability to operate within applicable financial regulations.

BlackRock’s tokenization strategy gains a Japanese focus

BlackRock’s involvement brings the collaboration into the orbit of one of the world’s largest asset managers and its existing tokenization initiatives.

The company has developed BUIDL, a tokenized fund that provides eligible investors with blockchain-based access to fund interests. Its tokenization efforts have also explored how eligible institutional investors could use tokenized fund holdings in collateral arrangements, subject to relevant eligibility and custody requirements.

The Japanese MOU, however, does not confirm that BUIDL or any other specific BlackRock-managed fund will participate. Its scope remains exploratory, with the technical design, distribution channels and eventual commercial structure still under consideration.

BlackRock Financial Management Managing Director Jonathan Steel said the collaboration would examine how digital infrastructure could connect traditional financial markets with emerging blockchain services. He also highlighted tokenization’s potential to expand access, improve efficiency and support the development of global capital markets.

The Yen stablecoin initiative could eventually offer a model for connecting regulated digital payment instruments with investment products, provided the partners can resolve the operational and compliance challenges. For now, that remains a possibility rather than a functioning service.

The companies plan to involve additional financial institutions and businesses as discussions continue. Their October 27 agreement marks the beginning of a feasibility process, leaving the participating funds, blockchain architecture, regulatory arrangements and launch timeline undecided.