Leading crypto exchange Binance is working in partnership with Japan’s top bank, MUFG to study the issuance of a new stablecoin pegged to fiat currencies.
The exchange in a statement on Tuesday said Binance Japan Inc. is conducting a joint study with the aim of issuing a stablecoin tied to fiat currency, in conjunction with Mitsubishi UFJ Trust and Banking Corporation (MUTB). The stablecoin is to be pegged to the Japanese Yen, as well as other top foreign fiat currencies, the statement said.
According to the statement, MUTB’s role includes exploring the use of its platform “Progmat Coin,” as infrastructure for stablecoin issuance. The two companies are expected to start operations by the end of next year after obtaining all necessary regulatory clearance.
This is coming just weeks after Binance created a new platform for its Japanese users following its shutdown due to regulatory challenges many years ago. The leading crypto exchange launched the platform last month after making some adjustments to suit regulators.
Binance first entered the Japanese market by acquiring Sakura Exchange BitCoin (SEBC), a licensed local crypto exchange service provider in November 2022. SEBC has now changed its business name from Sakura Exchange BitCoin (SEBC) to Binance Japan K.K, which is the current Binance subsidiary tailored to the needs of Japanese users.
Through the platform, new Japanese users can access services such as spot trading, bringing 34 tokens to its users in Japan, including BNB, and earn products, while derivatives services are to be made available in the future in a locally compliant manner.
Existing Binance Global users can now apply for migration to Binance Japan until November 30, after which their accounts will be set to withdrawal only mode, and non-compliant crypto assets automatically converted to Bitcoin.
Japan’s Regulation Favors Stablecoin
Japan is one of the most open countries to crypto and blockchain technology, but also takes regulation of the industry very seriously. This is why Binance had to shut down its operations in 2018.
However with the new legal framework for stablecoins introduced by Japan’s parliament in June 2022, issuing stablecoins in the country has become much easier. The framework which took effect in June this year demands that the stablecoins be linked to the yen or another fiat currency and that holders have the right to redeem them at face value.
Speaking on the importance of stablecoins for the economy and for web3 adoption, general manager of Binance Japan, Takeshi Chino said:
“Stablecoins have important use cases across the broader financial ecosystem – from a lower-cost and instantaneous cross border trade settlement for business clients, to the facilitation of trading other cryptocurrencies seamlessly for retail investors — stablecoins fill an important financial services need and are crucial for the success of Web 3.0 adoption.”
Also commenting on the stablecoin project, vice president of product of MUTB, Tatsuya Saito, said: “We believe that the new stablecoin from this collaboration will be a step forward in advancing Web 3.0.”
Binance Widening its Reach
Binance is facing many regulatory challenges, particularly in the U.S. This doesn’t seem to deter the company though, as it appears to be expanding nonetheless.
Apart from establishing in Japan and embarking on the stablecoin project, the exchange has also announced its return to Belgium, where it was banned earlier this year.
