Japanese banks to test issuance of stablecoins

Japanese banks to test issuance of stablecoins

Author: Robert Strickland (crypto expert)

Japanese banks to test issuance of stablecoins
Three Japanese banks will test the issuance of stablecoins on the Japan Open Chain blockchain
Three banks will participate in an experiment in digital coin issuance on Japan Open Chain blockchain

Japanese banks will test issuance and operations with stablecoins. This was announced by G.U. Technologies, the developer of the Japan Open Chain blockchain on which the experiment will be based.

Japan Open Chain is an Ethereum-compatible network that G.U. Technologies has developed with the advertising holding company Dentsu, digital bank Minna Bank, online artist community Pixiv, Kyoto University of Arts and technology company CORGEAR. The developers claim the blockchain is energy efficient and has a throughput of more than 1,000 transactions per second.

Later, the plan is to implement a system of stablecoins that meets all legal requirements; local governments and private companies will participate in the project at this stage.

The report says that the stablecoins issued by banks will work with popular cryptocurrency wallets such as MetaMask.

Japan has banned transactions with stablecoins tied to currencies other than the yen, such as USDT. As of May 6, this ban will be lifted and banks will be able to issue stablecoins pegged to different world currencies.

At the same time, rules will come into effect, which stipulate that for stablecoins issued domestically, the issuer will have to prepare collateral assets as proof. And as an anti-money laundering measure, stablcoin distributors will be required to record and transmit transaction information to regulators.

Japan has been developing the project since 2021. The goals of the new phase of experiments with CBDC will be to test the technical feasibility of integrating digital currency into the existing financial system and to improve the development based on the experience of private companies.

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