Binance and MUFG to Issue Stablecoins in Japan

Binance and MUFG to Issue Stablecoins in Japan

Binance Japan Collaborates with Mitsubishi UFJ Trust and Banking Corporation to Develop Stablecoins

Binance, one of the leading cryptocurrency exchanges, has announced its partnership with Mitsubishi UFJ Trust and Banking Corporation (MUTB) to develop stablecoins. The collaboration aims to issue stablecoins pegged to sovereign currencies such as the Japanese yen and comply with local laws. However, the ultimate goal is to drive Web3 adoption in Japan. The press release states that the joint study between MUTB and Binance Japan intends to accelerate the mass adoption of Web3 in the country, with operations expected to begin by the end of next year.

It is important to note that this study does not guarantee the issuance of stablecoins. Binance Japan still needs to obtain applicable regulatory approvals before proceeding. However, considering Japan’s aspirations for Web3 and the introduction of new stablecoin regulations, the necessary conditions may be in place to incubate such a project.

The involvement of MUTB, a traditional financial giant, adds legitimacy to the initiative. MUTB leads a consortium of banks and trust banks that plans to issue stablecoins on private and public blockchains through a compliant platform called Progmat Coin. Binance Japan also intends to utilize this platform.

Notably, Japan has taken a more positive stance towards Web3 and stablecoins compared to other jurisdictions. In April, the country published a roadmap to drive Web3 growth and promised increased oversight for consumer protection. Additionally, Japan introduced stablecoin rules in June, allowing Japanese exchanges to apply for a special license to trade stablecoins, including those issued overseas such as tether (USDT) and USD Coin (USDC). Circle, the issuer of USDC, has hinted at potentially leveraging these new rules to make the stablecoin available in the Japanese market.

While other regulators in the European Union and the United Kingdom have adopted a more stringent approach to regulating stablecoins, Japan seems to be embracing the concept. The country’s regulators recognize the potential of stablecoins and are working towards mitigating the risks associated with their usage.

To achieve this, MUTB’s Progmat platform comes into play. It serves as a neutral infrastructure that enables the issuance of various brands of stablecoins with the greatest flexibility of use and the least risk of de-pegging. Tatsuya Saito, the founder and CEO of Progmat Inc and vice president of product at MUTB, highlighted the platform’s ability to mitigate risks associated with stablecoins in a press release.

The joint study between Binance Japan and MUTB aims to explore the issuance of stablecoins that can be deployed on multiple blockchains, including Ethereum and Binance’s BNB Chain. This reflects the industry’s growing interest in interoperability among blockchains.

In conclusion, Binance Japan’s partnership with Mitsubishi UFJ Trust and Banking Corporation to develop stablecoins is a significant step towards driving Web3 adoption in Japan. The study conducted by both companies seeks to navigate the regulatory landscape and issue stablecoins that comply with local laws. Japan’s positive attitude towards Web3 and stablecoins, along with its introduction of stablecoin regulations, creates a conducive environment for such innovation. With the Progmat platform’s neutral infrastructure, risks associated with stablecoins can be mitigated effectively. As the study progresses, stablecoins deployed on multiple blockchains will become a realistic possibility, further fostering the growth of the blockchain industry in Japan.

Edited by Aoyon Ashraf.