A recent announcement from Binance indicated their intention to launch stablecoins pegged to the dollar, euro, and yen in Japan. Made feasible through its partnership with the trust banking division of Mitsubishi UFJ Financial Group (MUFG), this initiative is set to kickstart in the following year, as stated by Takeshi Chino, the general manager of Binance Japan.
Subject to regulations, additional offerings could be provided by 2024. The evolution of this partnership has seen both parties studying the parameters and procedures of these stablecoins’ issuance and operation. Following Japan’s pass of a law clarifying stablecoins’ legal status in June, advantages, including faster money transfers and settlements, are expected from the stablecoins’ introduction.
Hope for the Japanese stablecoin market size boils down to almost a quarter of the estimated current global market, predicting a significant size of up to 5 trillion yen ($34 billion). MUFG’s plans emphasize the use of its blockchain platform, Progmat, in minting stablecoins tied to foreign currencies. Despite this, for Binance to execute its plans, acquiring a license in Japan is necessary for fulfilling its role as an electronic settlement methods transaction business provider.
Binance Japan, a rebranded version of the SEBC, already assures Japanese crypto traders of over 30 tradable tokens. The expansion of stablecoin offerings would escalate not just crypto trading but, importantly, payment services as well.
This legalization led to the acceleration of interest from companies intending to enter the market via these digital tokens. Juxtaposed to Binance’s plans, Orix Bank, a Japanese institution, manifests interest in issuing stablecoins. If carried out, trials for stablecoins pegged to the yen, dollar, and other currencies would begin in October, eyeing to start operations in 2024.
In a similar vein, Circle, the company behind the USDC stablecoin, intends to penetrate the Japanese market. With Japan’s categorization as a potentially major market if stablecoin adoption enhances cross-border trade and global commerce, numerous ripple effects remain to be seen. The burgeoning stablecoin market in Japan is filled with potential strategic benefits for both companies and individuals alike, but the risks and regulatory concerns should not be overlooked.
Source: Cryptonews
