Interest from Binance and Other Companies in Japan’s Upcoming Stablecoin Endeavors

Crypto News- Binance, a leading cryptocurrency exchange, has initiated discussions with the Mitsubishi UFJ Trust and Banking Corporation (MUTB), Japan’s largest bank, to explore the potential issuance of stablecoins denominated in Japanese yen and other foreign currencies within the Japanese cryptocurrency market.

Interest from Binance and Other Companies in Japan’s Upcoming Stablecoin Endeavors

This strategic collaboration, announced on September 25th, signifies a significant step toward introducing stablecoins to Japan’s rapidly evolving cryptocurrency landscape. The joint effort aims to leverage MUTB’s stablecoin issuance platform, known as Progmat Coin, to facilitate the issuance of stable digital currencies backed by the Japanese yen and various fiat currencies.

On September 25th, Binance Japan officially unveiled a joint research project aimed at enabling both entities to issue stablecoins backed by the Japanese yen and various fiat currencies. The primary objective of this collaboration is to accelerate the adoption of Web3 technologies within Japan. To achieve this goal, Binance Japan and MUTB intend to leverage MUTB’s stablecoin issuance platform, known as Progmat Coin.

MUTB will play a pioneering role in developing the Progmat Coin platform, establishing it as a foundational infrastructure for the issuance of stablecoins in compliance with Japan’s recently revised Payments Services Act. This legislation, which came into effect in June, grants Japanese banks and regulated cryptocurrency service providers the authority to issue stablecoins. Progmat Coin is designed to facilitate stablecoin issuance on various blockchain networks, including Ethereum, Polygon, Avalanche, Cosmos, and BNB Chain.

Takeshi Chino, the General Manager of Binance Japan, highlighted the crucial role that stablecoins play in the broader financial ecosystem. He emphasized that stablecoins not only provide cost-effective and instantaneous cross-border trade settlement solutions for businesses but also facilitate seamless cryptocurrency transactions for retail investors. Chino noted, ”Stablecoins fulfill an important financial services need and are essential for the success of Web3 adoption.”

Tatsuya Saito, Vice President of Product at MUFG, estimated that Japan’s stablecoin market has the potential to reach up to 5 trillion yen (approximately $34 billion). This projection represents approximately 27% of the estimated current global stablecoin market, valued at $123.7 billion according to CoinGecko.

In addition to its collaboration with MUTB, Binance has been actively expanding its presence in the Japanese cryptocurrency market. In August 2023, Binance took a significant step by introducing 34 tokens to its Japanese customer base. This expansion demonstrated Binance’s commitment to providing a wide range of cryptocurrency offerings to Japanese users despite the regulatory challenges it has encountered in Western markets.

Moreover, the adoption of stablecoins in Japan is not limited to Binance. Orix Bank, a prominent financial institution in Japan, is reportedly exploring plans to issue stablecoins within the country. These stablecoins are expected to be denominated in Japanese yen, United States dollars, and potentially other currencies. Orix Bank aims to commence testing these stablecoins in October, with a targeted launch scheduled for 2024. These digital currencies will be backed by fiat deposits and will leverage the Japan Open Chain blockchain, a technology developed by Tokyo-based G.U. Technologies in collaboration with its partners.

The Japanese cryptocurrency landscape is witnessing significant developments that indicate a growing interest in stablecoins. In August, it was reported that Soramitsu, a Japanese blockchain startup, was actively exploring the establishment of a stablecoin exchange. This exchange would play a pivotal role in facilitating cross-border payment solutions for various Asian countries, demonstrating Japan’s commitment to advancing financial technologies and blockchain-based solutions in the region.

Furthermore, the Japanese government is reportedly considering regulatory measures that would allow startups to raise funds from the public by issuing cryptocurrency assets and stablecoins. This potential regulatory framework could further promote innovation and investment in the cryptocurrency sector within Japan, fostering an environment conducive to the growth of stablecoins and blockchain technologies.