Binance and Banking Giant MUFG Want to Drive Web3 Adoption in Japan by Issuing Stablecoins
Binance Japan, the Japanese entity of the global cryptocurrency exchange Binance, has announced a partnership with Mitsubishi UFJ Trust and Banking Corporation (MUTB) to develop stablecoins. The collaboration aims to issue stablecoins pegged to sovereign currencies like the yen while ensuring compliance with local laws. However, the ultimate goal is to drive the adoption of Web3 technology in Japan.
The joint study will explore the possibility of issuing stablecoins that can contribute to the mass adoption of Web3 in the country. The companies intend to commence relevant operations by the end of next year. It is important to note that the study does not guarantee the issuance of stablecoins, as Binance Japan still needs to obtain regulatory approvals before moving forward. Nevertheless, the ambitions of Japan’s Web3 initiatives, alongside the newly implemented stablecoin regulations, create favorable conditions for such a project to take shape.
The involvement of MUTB, a traditional financial giant, lends credibility to the collaboration. MUTB leads a consortium of banks and trust banks that plans to issue stablecoins on private and public blockchains through a compliant platform called Progmat Coin, which Binance Japan also intends to utilize.
Progmat Coin has obtained permissions under the new stablecoin rules implemented in Japan in June. These rules enable Japanese exchanges to apply for a special license to trade stablecoins, including those issued overseas such as tether (USDT) and USD Coin (USDC). Circle, the issuer of USDC, has even expressed interest in leveraging these new rules to make its stablecoin available in the Japanese market.
In contrast, other jurisdictions like the European Union and the United Kingdom have adopted stricter regulations for stablecoins. The collapse of terraUSD, a stablecoin that lost its parity with the U.S. dollar, led to increased concerns and scrutiny surrounding stablecoin regulation. MUTB’s Progmat platform aims to address such risks and provide a neutral infrastructure for the issuance of various stablecoin brands with flexibility and minimal de-pegging risks.
As part of their partnership, Binance Japan and MUTB will explore the issuance of stablecoins that can be deployed on multiple blockchains, including Ethereum and Binance’s BNB Chain. This interoperability will potentially enhance the overall efficiency and usability of stablecoins within the ecosystem.
The collaboration between Binance Japan and MUTB represents a significant step towards the development and adoption of stablecoins in Japan. By partnering with a trusted financial institution and aligning with regulatory requirements, Binance Japan is positioning itself to play a crucial role in the future of digital currencies in the country. The success of this joint study and potential stablecoin issuance could pave the way for broader adoption of Web3 technology and further advancements in Japan’s crypto landscape.
