Japanese Banks Launch Yen-Pegged Stablecoins to Challenge USDT, USDC

Japan’s three largest banking institutions, MUFG, Sumitomo Mitsui, and Mizuho, are set to launch yen-based stablecoins, challenging the dominance of USDT and USDC in the stablecoin market.

This move could significantly reshape Japan’s digital asset landscape, bolstering local currency-backed stablecoin use and potentially reducing reliance on U.S. dollar-pegged options.

Japan’s Top Banks Push Yen Stablecoins

Japan’s three largest banks, Mitsui Financial Group, MUFG, and Mizuho Financial, are launching yen-pegged stablecoins to challenge USDT and USDC’s dominance. These banks, backbones of Japanese finance, aim to strengthen crypto adoption in the region by integrating stablecoins into existing financial structures. Digital Currency: Overview of the BOJ’s Initiatives outlines their plans.

Potential Market Disruption with New Stablecoins

Immediate effects could redirect liquidity in Japan’s crypto market, potentially impacting other yen-denominated assets and challenging existing stablecoins like USDT and USDC. A financial analyst mentioned, “We finally have our first issuer. I want to encourage more local firms to enter so Japan doesn’t fall behind global trends.” Mizuho Custody Newsletter – August 2025 provides deeper insights into these shifts.

Japan’s Digital Asset Evolution and Insights

Past initiatives like Project Pax tested stablecoins for payments, showing Japan’s long-standing interest in digital assets and their regulatory frameworks. According to the BIS Annual Report 2025, historical trends suggest increased institutional crypto usage, with Japan adopting stringent regulations to sustain these newly launched yen-pegged stablecoins amid global market competition.