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Binance, a prominent crypto exchange, and Mitsubishi UFJ Trust and Banking Corporation (MUTB) - Japan's premier bank, are joining forces to look into the possibilities of rolling out stablecoins in Japan.
The exploration was made public on September 25, when Binance Japan shed light on a combined research initiative. Their goal is to create stablecoins that are backed by the Japanese yen, among other traditional currencies. This move aims to fast-track the implementation of the Web3 protocol in Japan. MUTB's Progmat Coin platform will be pivotal in this venture.
Following a legislative update in June, the revised Payments Services Act in Japan now empowers banks and approved cryptocurrency firms to introduce stablecoins. MUTB has taken the lead by evolving its Progmat Coin platform. This platform is capable of endorsing the creation of stablecoins on various networks including Ethereum, Polygon, BNB Chain, Cosmos, and Avalanche.
The value stablecoins bring to the expansive financial landscape is immense, commented Takeshi Chino, the leading figure at Binance Japan. He emphasized their role in ensuring cost-efficient and immediate international trade settlements for various enterprises. Chino also pointed out their significance in streamlining crypto transactions for individual investors.
There's a potential in Japan's stablecoin market that's hard to ignore. Tatsuya Saito, MUTB's product vice president, indicated that this market might expand to a value of 5 trillion yen, approximately $34 billion. For a clearer perspective, this would account for nearly 28% of the global market's current estimate, which stands at $123.7 billion, based on data from CoinGecko.
Back in August 2023, Binance began its journey in the Japanese market, offering 34 tokens. This was despite the considerable regulatory challenges they encountered in Western regions.
In related news, Japan’s Orix Bank is also reportedly considering the introduction of stablecoins. Their preliminary tests will focus on the yen and U.S. dollar, targeting a 2024 launch. The stablecoins will gain support from traditional currency deposits, backed by the Japan Open Chain blockchain, a creation of Tokyo's G.U. Technologies and its allies.
To further boost this momentum, Japan has plans to allow startups to garner public funding through the issuance of cryptocurrency assets and stablecoins.
