- Japan’s top financial regulator has approved the country’s first-ever yen-pegged stablecoin.
- The new JPYC token will be fully backed by domestic deposits and Japanese Government Bonds.
- The move is a major step in Japan’s push to create a regulated digital finance sector.
Japan has officially entered the stablecoin race after the country’s Financial Services Agency (FSA) granted regulatory approval to JPYC Inc., a Tokyo-based fintech startup, to issue Japan’s first yen-pegged stablecoin.
The token, also branded as JPYC, is expected to debut in the autumn of 2025 and will maintain a one-to-one peg with the Japanese yen. In a statement, Chief Executive Noritaka Okabe confirmed the stablecoin will be fully backed by domestic deposits and Japanese Government Bonds (JGBs), ensuring compliance with the country’s updated Payment Services Act.
By operating under a funds transfer service provider license, JPYC is transitioning from a prepaid token operator to a fully regulated issuer.
Unique, Zero-Fee Business Model
Unlike many global stablecoin issuers, JPYC will not charge transaction fees. Instead, its business model will rely entirely on the interest income generated by the JGB reserves backing the tokens. For every ¥1 trillion issued, the firm estimates it will generate gross annual revenue of approximately ¥5 billion from bond yields.
The company expects its first users to be hedge funds, family offices, and institutional investors within Japan. Over time, JPYC aims to expand its adoption to international remittances and corporate settlements.
How Japan’s Approach Differs from the US and China
The launch comes as global regulation of stablecoins accelerates. In July, U.S. President Donald Trump signed federal legislation establishing rules for dollar-backed tokens.
Related: U.S. Treasury Clarifies Position on Strategic Bitcoin Reserve Plans
Meanwhile, major American financial institutions like Bank of America and Fiserv are preparing their own stablecoin products. By contrast, Chinese regulators recently instructed domestic brokers to suspend research on stablecoins, underscoring Beijing’s restrictive stance.
Analysts note that JPYC will reinforce the yen’s role in global markets. The introduction of a fully regulated, blockchain-based yen stablecoin will enhance the currency’s utility in international finance.
Okabe has warned that nations without domestic stablecoin frameworks risk facing higher borrowing costs as investor demand consolidates around regulated digital currencies tied to sovereign bonds.
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