JPYC Inc., a Japanese fintech firm, has launched the country's first legally recognized yen-denominated stablecoin, known as JPYC. The trading of this stablecoin commenced on Monday, local time.
According to a press release from the company, the JPYC token is issued alongside the launch of its dedicated issuance and redemption platform, JPYC EX. JPYC Inc. registered as a fund transfer service provider with Japan's Financial Services Agency in August.
The JPYC stablecoin aims to maintain a 1:1 peg to the Japanese yen and operates on blockchains such as Avalanche, Ethereum, and Polygon. All issued JPYC tokens are backed by 100% reserves held in yen deposits and government bonds, in compliance with Japan's Payment Services Act.
Users can obtain JPYC through the JPYC EX platform after completing identity verification using the My Number card, Japan's official identity document for citizens and residents.
The company has set an ambitious target of achieving a circulation of 10 trillion yen ($65.4 billion) within three years and plans to expand the supported blockchains and partnerships with businesses. For context, USDT, the largest stablecoin globally, currently has a circulating supply of approximately $183.2 billion.
Several Japanese companies are planning to integrate JPYC into their services. For instance, fintech software firm Densan System is developing payment systems for retail and e-commerce platforms that will utilize the JPYC stablecoin. Asteria also plans to incorporate JPYC functionality into its enterprise data integration software, which serves over 10,000 companies. Additionally, crypto wallet HashPort is looking to support JPYC transactions.
The launch of JPYC coincides with Japan's efforts to enhance oversight in the emerging stablecoin sector. In June 2023, the country revised its stablecoin regulations, mandating that service providers register under the Funds Settlement Act and the Banking Act to issue or manage stablecoin circulation.
Moreover, several prominent Japanese financial institutions are exploring the issuance of stablecoins. For example, SMBC announced plans in April to launch its own stablecoin in partnership with Ava Labs and Fireblocks, as reported by Nikkei.