MUFG is engaging with popular stablecoin issuers to offer these tokens through its blockchain network Progmat.
According to Bloomberg, Mitsubishi UFJ Financial Group (MUFG), the largest bank on Japanese soil, is discussing with various firms, including leading stablecoin providers, to issue these digital assets via its Progmat platform.
The bank’s product vice president Tatsuya Saito acknowledged that MUFG was eyeing minting stablecoins pegged to fiat currencies, such as the U.S. dollar, using its network. He said this was in line with the Japanese stablecoin law that became effective on June 1.
The legislation is among the top nations because it permits Japan’s trust companies, registered monetary transfer agents, and licensed banks to issue stablecoins.
Stablecoins have risen in popularity thanks to various advantages like low transfer charges. Furthermore, investors use them when trading cryptocurrencies with high volatility.
When asked which stablecoin providers MUFG was engaging with, Saito did not give specific details. Nevertheless, he disclosed that the bank talked to various entertainment companies and financial and non-financial institutions about stablecoin projects.
Japan Seeks to be a Stablecoin Hub
According to Saito, the Japanese law that became operational earlier this month has set the ball rolling for Japan to become a stablecoin hub, and the latest MUFG development cements this objective.
He pointed out that inquiries were coming from both overseas and Japanese financial groups about the stablecoin issuance.
The Japanese administration, through Prime Minister Fumio Kishida’s program, seeks to revamp the nation’s economy via the New Capitalism rubric, which supports the development and growth of Web3 firms. Therefore, digital assets like stablecoins are expected to benefit from this agenda.
Per CoinGecko data, nearly $130 billion is in circulation in the stablecoin market, with the leading one being Tether (USDT).
Meanwhile, various nations are weighing their options in this sector, as evidenced by US legislation meant to shed more light on stablecoin status. It is set for debate and vote next month.
Furthermore, Singapore recently sought insights from leading industry players, such as JPMorgan, Amazon, DBS Bank, and the IMF, about stablecoin standards.
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