- Japan’s three biggest banks plan to launch a joint yen-backed stablecoin by March 2027.
- The project aims to boost Japan’s presence in the stablecoin market.
- Demand is rising as stablecoin use continues to grow globally.
Today, on Wednesday, 10 June, Japan’s three largest banks announced that they will jointly issue a yen-backed stablecoin during this fiscal year, which ends in March 2027.
Mitsubishi UFJ Financial Group’s (MUFG) banking arm, Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group will establish a council to form a framework for exploring the potential development. The aim is to conduct actual commercial transactions using the stablecoin – deemed the ‘Subject Stablecoin’ – this financial year.
The triad, collectively referred to as the ‘Three Banks’ from now on, will use the council to examine the stablecoin’s system design and governance structures, while accounting for any relevant laws, regulations, and market trends.
Back in October 2025, Japanese startup JPYC launched the first-ever stablecoin pegged to the yen, backed by domestic savings and Japanese government bonds (JGBs). This was followed by an announcement from Japan’s Financial Services Agency in November, committing to supporting the Three Banks in their efforts to develop the Subject Stablecoin.
A stablecoin is a form of cryptocurrency that maintains a fixed value by being pegged to a specific, stable asset – most commonly one-to-one with a country’s local currency. At the moment, the US dollar dominates, accounting for around 99% of the stablecoin market cap. This is largely because of the regulatory clarity brought on by the US’ GENIUS Act, signed into law by US President Donald Trump in July 2025.
According to the International Monetary Fund (IMF), the increased use of stablecoins could trigger a move away from domestic currencies to dollar-pegged assets, weakening central bank control over domestic liquidity and economic activity. The risk is amplified for countries with high macroeconomic instability.
However, certain jurisdictions such as Hong Kong, Singapore, and the UAE are challenging the US’ monopoly by demonstrating strong adoption and regulatory support.
Stablecoin use has been experiencing accelerated expansion over the last couple of years. According to analysis by Visa, transaction volume grew from around $565 billion in 2020 to about $11 trillion in 2025, reflecting a yearly increase of approximately 80%.
