MUFG facilitates Japanese bank-backed stablecoins through Progmat Coin platform.

Megabank Mitsubishi UFJ Financial Group (MUFG) has announced that banks in Japan will soon be using its stablecoin issuance platform, “Progmat Coin,” to launch Japanese yen-pegged stablecoins on several public blockchains.

Following new regulations that came into effect this month, Japanese banks have recently expressed their intentions to either investigate or launch stablecoins.

In mid-2022, the Japanese government passed a bill prohibiting non-banking institutions from issuing stablecoins. The bill officially took effect on June 1, 2023.

In a June 2 announcement, MUFG outlined that Progmat Coin will be used to facilitate the issuance of bank-backed stablecoins on Ethereum, Polygon, Avalanche, and Cosmos, with more networks to be added in the future.

MUFG also revealed that its blockchain tech and security partners, Toki and Datachain, are building a bridge to enable cross-chain transactions, lending, and swaps between the supported blockchains.

The bank expects the cross-chain infrastructure to be launched in the second quarter of 2022.

MUFG initially announced Progmat Coin in February 2022, with the aim of providing an interoperable and “universal digital asset payment method” for stablecoins, other crypto assets, and even a Japan-based central digital bank currency.

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MUFG has not disclosed which banks will be the first to use Progmat Coin. However, it confirmed to Cointelegraph at the time of its 2022 announcement that it is working on launching its own Japanese yen-pegged stablecoin.

According to a June 1 report from Nikkei Asia, Shikoku Bank, Tokyo Kiraboshi, and Minna Bank all plan to issue stablecoins. However, it appears that they will not be using the Progmat Coin platform to do so.

The publication states that these banks will use a separate stablecoin platform developed by Tokyo-based startup G.U. Technologies.

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