Three Japanese banks start stablecoin experiment
|Three Japanese banks are to experiment with stablecoin payments as they work to implement a system that meets legal requirements, according to a Thursday press release.
Tokyo Kiraboshi Financial Group, Minna no Bank and The Shikoku Bank will use a system developed by GU Technologies, a Web3 infrastructure company, on the Japan Open Chain, a public blockchain fully compatible with Ethereum that complies with Japanese law.
"We will conduct an experiment to confirm that each bank can issue its own stablecoin that can be used in Ethereum wallets such as MetaMask while complying with the Payment Services Act," the companies said.
Japan has been moving toward allowing stablecoins. Following the collapse of multibillion-dollar algorithmic stablecoin issuer Terra in 2022, parliament passed a set of stablecoin-specific rules focused on investor protection. The government also plans to allow stablecoins issued outside the country to be listed on local exchanges. Additionally, new rules to be implemented in June will allow Japanese exchanges to apply for a special license to trade stablecoins.
The proof-of-concept for the issuance of stablecoins "backed by assets" through demonstration experiments involving local governments and private companies has already begun, according to the announcement.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.