What happened?
Three of Japan’s biggest banks — Mitsubishi UFJ, Sumitomo Mitsui and Mizuho — announced they’ll issue yen-backed stablecoins (with a dollar option possible later). They’re building the system through MUFG’s Progmat and teaming up with crypto firms like Bitbank, Avalabs and Fireblocks, and Mitsubishi Corporation will test the yen coin for settlements. The banks plan to issue up to 1 trillion yen of JPYC over the next three years to drive corporate adoption.
Who does this affect?
Corporate clients and more than 300,000 business partners of the megabanks are the main targets for payments and settlements using the new stablecoins. Exchanges, fintech firms, DeFi users and people sending money abroad (like students) will also be affected as JPY stablecoins enter wider use. Global stablecoin issuers, investors, and US dollar–pegged token users will feel the impact as Japan creates a regulated, bank-backed alternative.
Why does this matter?
This move could chip away at USDT and USDC dominance by offering a trusted, bank-issued yen stablecoin backed by liquid reserves and regulatory compliance. If the banks reach the planned scale (about ¥1 trillion, roughly $6.6 billion), it could shift onshore trading volumes, corporate cross-border flows and DeFi liquidity toward JPY-denominated tokens. That shift would reshape market share, reduce reliance on US-based issuers, and push competition and standards for global stablecoins.