The Japanese Financial Services Agency (FSA) announced its support for the country’s three largest banks in creating a proof-of-concept for a stablecoin.
Japan’s financial regulator indicated that Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group, and Mizuho Financial Group will collaborate on the joint issuance of a stablecoin as a digital payment instrument.
The experiment is set to begin this month and will continue for the foreseeable future.
Stablecoins—digital tokens tied to the value of traditional financial assets like fiat currencies—have seen significant growth over the past two years, surpassing $300 billion in market cap last month.
This trend has also materialized in Japan, where the first stablecoin pegged to the yen was introduced in late October by a startup.
Amid this context, traditional financial institutions, including Japan’s largest banks, are working alongside regulators and lawmakers to explore the issuance of stablecoins and their integration into existing financial and technological frameworks.
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