MUFG Leads Stablecoin Development Through Progmat Blockchain Platform
Japan's Mitsubishi UFJ Financial Group (MUFG) is in advanced discussions with stablecoin issuers to launch foreign currency-pegged stablecoins via its Progmat blockchain platform. This initiative aligns with Japan’s Stablecoin Act, enacted on June 1, which restricts stablecoin issuance to licensed banks, registered money transfer agents, and trust companies.
Key Developments:
- Progmat’s Multifunctional Role: Designed to support third-party security token offerings and stablecoins pegged to USD/other currencies.
- Regulatory Clarity: The Act mandates 1:1 cash backing for stablecoins, enhancing transparency and reducing volatility risks.
- Global Expansion: MUFG aims to position Japan as a stablecoin innovation hub, attracting inquiries from overseas financial institutions.
Tatsuya Saito, MUFG VP: "The legislation allows issuers and users to adopt stablecoins with confidence. Progmat enables cross-border use cases while complying with Japan’s stringent standards."
Why Japan’s Stablecoin Market Matters
1. Regulatory First-Mover Advantage
Japan is among the earliest major economies to establish a comprehensive stablecoin framework, addressing:
- Reserve Requirements: Full cash backing mitigates TerraUSD-like collapses.
- Issuer Accountability: Licensed entities reduce fraud risks.
2. Market Potential
- Current Stablecoin Supply: ~$130B (per CoinGecko), dominated by Tether (60% share).
- USD Coin (USDC) and other issuers must comply to enter Japan’s market.
3. Web3 and Economic Policy Synergy
Prime Minister Kishida’s "New Capitalism" initiative prioritizes Web3 adoption, including:
- Blockchain-based decentralized internet infrastructure.
- Tax incentives for crypto enterprises (e.g., relaxed token listing rules).
FAQs: Japan’s Stablecoin Ecosystem
Q1: Who can legally issue stablecoins in Japan?
A: Only licensed banks, money transfer agents, and trust companies under the Stablecoin Act.
Q2: How does Progmat ensure stability?
A: By enforcing 1:1 cash reserves and enabling third-party audits for transparency.
Q3: Can foreign stablecoins operate in Japan?
A: Yes, if they comply with local regulations, including reserve backing and licensing.
Strategic Outlook
MUFG’s collaboration with entertainment firms, non-financial businesses, and global banks underscores Japan’s ambition to lead in blockchain-based financial solutions.
👉 Explore how blockchain is transforming global finance
With progressive policies and institutional support, Japan could redefine stablecoin standards worldwide, offering a blueprint for balancing innovation and security.
Disclaimer: This content is for informational purposes only and does not constitute financial advice.
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