Japan today launched the world’s first stablecoin pegged to the yen, marking a historic milestone in the nation’s shift toward blockchain-based finance. The digital currency, issued by fintech startup JPYC Inc., is fully convertible into Japanese yen and backed by domestic savings and Japanese government bonds (JGBs).
The launch follows official approval from Japan’s Financial Services Agency (FSA) and represents a major step in the country’s long-term digital payment strategy. JPYC said its stablecoin will initially carry no transaction fees, with the firm earning revenue from interest on its JGB holdings instead.
The initiative comes amid a surge in global interest in digital assets, following U.S. President Donald Trump’s vocal support for the sector. Meanwhile, China is also exploring yuan-backed stablecoins, signaling growing momentum for blockchain integration into mainstream finance.
Japan’s adoption of cashless payments has already grown sharply, from 13.2% in 2010 to 42.8% in 2024, according to government data, and the launch of a regulated yen-backed stablecoin is expected to accelerate that growth further.
Adding to the momentum, Japan’s “Big Three” banks, Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho, are preparing to launch a joint stablecoin system for corporate settlements on October 31 via MUFG’s Progmat platform. The project could connect over 600,000 NetStars payment terminals nationwide by mid-November, bringing digital yen transactions into everyday commerce.
Globally, stablecoins backed by the U.S. dollar dominate the $286 billion market, accounting for more than 99% of supply. The yen-pegged JPYC thus becomes the first major non-USD stablecoin issued by an advanced economy, potentially reshaping liquidity flows in Asia and boosting demand for JGBs.
Bank of Japan Deputy Governor Ryozo Himino recently said stablecoins “might emerge as a key player in the global payment system,” partially replacing traditional deposits. Analysts believe yen-based stablecoins could gain traction within two to three years, fueling growth in decentralized finance and cross-border settlement systems.