JPYC poised to launch as FSA clears path for domestic fiat-pegged digital currency
Japan’s Financial Services Agency (FSA) is preparing to approve the country’s first yen-backed stablecoin this fall, a landmark step in integrating digital assets into the traditional financial system. The move will allow Japanese residents and institutions to access a homegrown stablecoin pegged directly to the yen.
According to reports, Tokyo-based fintech firm JPYC will register as a licensed money transfer business within the month and lead the rollout. The stablecoin will maintain a 1:1 peg with the Japanese yen, backed by highly liquid assets such as bank deposits and Japanese government bonds (JGBs). Tokens will be issued through bank transfers and stored in digital wallets for both individual and corporate users.
The approval comes as the global stablecoin market surpasses $286 billion, largely dominated by dollar-pegged assets such as USDT and USDC. While dollar-denominated stablecoins already circulate in Japan, this marks the first yen-based option, potentially reshaping domestic demand for digital payments and settlements.
Okabe, a representative of the issuing company, suggested that yen stablecoins could significantly boost demand for Japanese government bonds. Drawing comparisons to the U.S., he noted that major stablecoin issuers there have become some of the largest holders of U.S. Treasurys, using them as collateral for circulating tokens.
“JPYC will likely start buying up Japanese government bonds in large quantities going forward,” Okabe said, adding that countries lagging in stablecoin adoption risk higher bond yields by missing this new stream of institutional demand.
Circle’s entry sets precedent
Earlier this year, Circle’s USDC became the first foreign-issued stablecoin approved in Japan, after receiving clearance from the FSA in March and listing on SBI VC Trade. The addition of JPYC signals Japan’s commitment to developing its domestic digital currency ecosystem while ensuring regulatory oversight.
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