Japan's three largest financial institutions, often referred to as the country's banking megabanks - Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC) and Mizuho Financial Group - have reached a basic agreement to jointly issue stablecoins. According to the latest information, they plan to launch these real-currency-linked tokens by the end of the fiscal year at the latest. 2026, that is, until March 2027.
This step represents a major milestone in the digitalization of the Japanese financial sector and will significantly accelerate the adoption of blockchain technologies in the local corporate environment.
Common standard and regulator support
To ensure a smooth launch, the banks are establishing a dedicated steering committee to oversee the operational and technical implementation. The initiative is also being overseen and supported by Japan’s Financial Services Agency (FSA). The regulator is providing banks with legal guidance and ensuring the project complies with international digital asset standards as part of its new fintech support program.
Interoperability is a key element of the entire project. Stablecoins will be built on a single technical and legal standard (using the Progmat platform), which will enable seamless transfers of funds between clients of different banks.
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First yen, later maybe dollar
The new digital tokens will be backed by real fiat currencies at a 1:1 ratio, eliminating the sharp price fluctuations typical of classic cryptocurrencies. In the first phase, a stablecoin pegged to the Japanese yen (JPY) will be launched, with a possible expansion to include a version pegged to the US dollar (USD) in the future.
The main goal of this initiative is to make intra-company and inter-company settlements and international capital transfers more efficient, faster and cheaper. The first large corporate user to implement the new system will be leading Japanese trading company Mitsubishi Corporation.
It plans to use stablecoins for internal clearing and financial settlement between its more than 240 subsidiaries around the world, which will dramatically simplify international dividend transfers, for example.
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Ambitious goals for the future
The banking consortium associated in the project, which bears the working name Project Pax, aims to achieve this by the year 2028 business-to-business (B2B) transaction volume of 1 trillion yen. In parallel with this project, another initiative by large banks and brokerage houses is emerging in Japan, which seeks to tokenize Japanese government bonds and introduce instant settlement in a 24/7 mode using stablecoins.
