Japan Introduced Yen-Backed Stability Coin JPYC

Japan has made a significant step in the history of digital currency by officially introducing the first yen-backed stablecoin, JPYC. This development has attracted the attention of investors in the cryptocurrency ecosystem. The stablecoin, launched by JPYC Inc., stands out as it has legal status. JPYC became the first stablecoin issuer registered with the Japanese Financial Services Agency (FSA), complying with the regulations under the Payment Services Act.

The JPYC token is designed to be pegged to the Japanese yen at a one-to-one ratio and will operate on the Avalanche, Ethereum, and Polygon networks. The company announced that it will fully back its JPYC supply by 100% with yen deposits and government bonds. Users will be able to purchase this stablecoin through the JPYC EX platform by verifying with their My Number identification card.

JPYC Inc. aims to achieve a circulation of 10 trillion yen (approximately $65.4 billion) within three years. This target stands out when compared to the world's largest stablecoin, USDT, which currently has a supply of about $183.2 billion. The company plans to support more blockchains in the future and increase integration with Japanese businesses.

With the launch of JPYC, several Japanese companies have started to integrate this new stablecoin into their systems. Densan System is developing JPYC-based solutions for retail and e-commerce payments, while Asteria plans to add JPYC support to its enterprise data integration software. HashPort, a cryptocurrency wallet provider, will also support JPYC transfers.

The launch of JPYC coincides with a period in which Japan is strengthening regulations regarding the stablecoin sector. The legal amendment that came into force in 2023 mandates that companies managing the issuance or circulation of stablecoins fall under the Funds Settlement Act and Banking Act. Following this development, major financial institutions in Japan have also accelerated their stablecoin plans. For instance, SMBC announced in April that it plans to develop its own stablecoin in collaboration with Ava Labs and Fireblocks.