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Japanese Banks Prepare to Issue Stablecoin

Japanese banks have announced their intention to review or launch stablecoins following new regulations that came into effect this month. In mid-2022, the Japanese government passed a bill banning stablecoin issuance by non-banking institutions. The bill, passed almost a year ago, went into effect on June 1.

MUFG stated in an announcement yesterday that Progmat Coin will be used to facilitate the issuance of bank-backed stablecoins on Ethereum, Polygon, Avalanche and Cosmos. The organization also announced that these networks will be expanded further in the future. MUFG also announced that blockchain technology and security partners Toki and Datachain are building a bridge between supported blockchains to enable cross-chain transactions, lending and swaps. The bank expects the cross-chain infrastructure to be implemented in the second quarter of 2022.

In February 2022, MUFG first announced Progmat Coin, which aims to provide an interoperable and universal digital asset payment method for stablecoins, other crypto assets, and even a Japan-based centralized digital bank currency. On the other hand, MUFG has not yet announced the banks that will use Progmat Coin first. However, during his 2022 announcement, he confirmed to Cointelegraph that he was working to launch his own Japanese yen-pegged stablecoin.

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