Tokyo-based fintech company JPYC has launched the first stablecoin backed by the Japanese yen along with a platform for issuing the new currency, amid an increasing global race to contain the growing market.
The Japanese yen stablecoin JPYC went live on Monday and is individually backed by bank deposits and government bonds, and also has a 1:1 exchange rate with the yen, the company said on Friday.
At a press conference in Tokyo, JPYC President Noriyoshi Okabe said his company's stablecoin is a “milestone in the history of Japanese currency,” and has also attracted interest from seven companies planning to merge it, according to a report by Business Insider Japan.
The launch of JPYC came as the global stablecoin market, dominated by dollar-pegged assets such as USDT (USDT) and Circle's (USDC), has exploded to a market capitalization of more than $308 billion. US dollar stablecoins have already established a foothold in Japan, with Circle launching USDC in the country on March 26.
Stablecoin platform launched
In conjunction with its stablecoin, the company also launched JPYC EX, a dedicated platform created for token issuance and redemption, which is governed by strict identity and transaction verification under the Prevention of Transfer of Proceeds of Criminal Act.
Users can deposit JPY into an account via bank transfer to receive JPYC to a registered wallet address and also redeem the amount in Yen to a withdrawal account.
In the long term, JPYC hopes to “achieve an issuance balance of 10 trillion yen over the next three years and meet the challenge of creating new social infrastructure through stablecoins.”
Japan's stablecoin market may soon have other competitors
JPYC may not be the only company to hold a stablecoin for a long time. Monex Group, a Tokyo-based financial services company, announced in August that it had plans to launch a stablecoin pegged to the Japanese yen.
Related to: Financial giant Western Union is experimenting with transfers based on stablecoins
Three of Japan's largest banks, Mitsubishi UFJ Financial Group (MUFG) and Sumitomo Mitsui Banking Corp, are hoping to… (SMBC) and Mizuho Bank, in jointly issuing a yen-pegged stablecoin on MUFG Progmat's stablecoin issuance platform.
Meanwhile, Japan's Financial Services Agency may be preparing to review regulations that would allow banks to acquire and hold cryptocurrencies, such as Bitcoin (BTC), for investment purposes.
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