Market News

Japan Unveils Its First Yen-Backed Stablecoin Amid Growing Interest in Digital Assets

Japanese startup JPYC has officially launched the first stablecoin pegged to the yen, named "JPYC," backed by both domestic savings and Japanese government bonds.

This initiative marks Japan's entry into a cryptocurrency sector predominantly ruled by US Dollar-tied tokens, such as USDT and USDC.

The JPYC stablecoin aims to provide a 1:1 backing through deposits and Japanese government bonds, enhancing its credibility.

Initially available on Ethereum, Avalanche, and Polygon, JPYC has plans to expand its blockchain compatibility further.

Notably, JPYC is offering zero fees for its issuance and redemption, which will help attract users while generating income from the interest on the JGBs.

The company has set an ambitious goal of issuing up to 10 trillion yen, equivalent to approximately $65.5 billion, over the next three years.

With the current market cap of USDC at about $76.3 billion, JPYC's launch could pave the way for increased competition in the stablecoin market.

Additionally, three major Japanese banks are also preparing to release their yen-backed digital tokens by the end of 2025, indicating strong institutional interest.

This surge in crypto initiatives aligns with Japan's potential regulatory changes that may enable banks to engage more actively with digital assets.

In contrast, while Japan is embracing crypto progress, China remains cautious, imposed limitations on stablecoin developments, indicating a stark difference in the regional approaches to digital currencies.