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Tokyo-based fintech company JPYC will register as a money transfer business with the FSA within August, setting the stage for the approval of the first yen stablecoin.
The company has already been operating a version of the token, also named JPYC, but will now bring it under Japan’s stablecoin framework, with wider sales to individuals, corporations, and institutional investors expected to start once its registration as a money transfer business is concluded.
JPYC’s stablecoin is designed to maintain a 1:1 peg with the Japanese yen. To prop up its peg, the stablecoin will be backed by highly liquid assets like bank deposits and government bonds.
Stablecoins are crypto assets that track the value of a traditional financial asset such as a fiat currency. The crypto industry’s biggest stablecoins, Tether’s USDT and Circle’s USDC, are pegged to the U.S. dollar, but there is a growing list of tokens that track other currencies like the euro.
 
Although US dollar stablecoins already have a foothold in Japan, this will be the nation’s first domestic yen-based product.
JPYC aims to issue roughly $6.7 billion worth of its stablecoin within three years. According to the report, the company has already attracted multiple hedge funds that expressed interest in the stablecoin.
Japan has undertaken steps to regulate the stablecoin market. The country’s stablecoin legislation came into effect in June 2023 under its Payment Services Act, with additional amendments recognizing fiat-pegged stablecoins as “Electronic Payment Instruments.”
Meanwhile, in the U.S., pro-crypto President Donald Trump has stressed the importance of promoting dollar-backed stablecoins, pushing lawmakers to create the necessary regulatory framework to do so.
With the recent approval of the landmark GENIUS Act that will bring more clarity to stablecoins in the U.S., more traditional players will likely foray into the stablecoin sector. In February, Bank of America CEO Brian Moynihan revealed the bank would “go into that business” if made legal.
Source: https://zycrypto.com/japans-regulator-to-approve-first-regulated-yen-denominated-stablecoin-as-early-as-this-fall/