Japan launched the world’s first yen-pegged stablecoin on Monday (27 October), marking a cautious step forward in a country where cash and credit cards still dominate daily transactions.
JPYC, a Japanese startup, began issuing the stablecoins, also called JPYC, which are fully convertible to the yen and backed by domestic savings and Japanese government bonds (JGBs), Reuters reported.
The company plans to issue up to ¥10 trillion (US$66 billion) worth of JPYC over three years, with ambitions for the digital asset to gain international use.
To encourage adoption, JPYC will initially waive transaction fees, instead earning revenue from interest on JGB Holdings.
“We hope to spur innovation by giving startups access to low transaction and settlement fees,”
said CEO Noritaka Okabe.
“Increasing global interoperability would benefit us too, so we’re open to capital tie-ups.”
Blockchain-based stablecoins are typically pegged to fiat currencies and enable faster, cheaper transactions. US dollar-pegged stablecoins dominate the market, accounting for more than 99% of global supply.
Tomoyuki Shimoda, a former Bank of Japan executive and Rikkyo University academic, said yen stablecoins are unlikely to see the same traction as dollar-backed ones.
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