Japan's FSA to Support Country's 3 Largest Banks in Stablecoin Issuance

Japan's Financial Services Agency (FSA) is backing the country's three largest banks—Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group—in a proof-of-concept to issue a stablecoin as an electronic payment instrument. This initiative aims to explore the joint issuance of stablecoins to enhance payment systems. The FSA's support comes amid a significant surge in stablecoin market capital, which exceeded $300 billion recently. The experiment will start this month and will focus on integrating stablecoins into Japan’s financial infrastructure, reflecting a broader trend among traditional financial institutions and regulators interested in the stablecoin landscape. The initiative aligns with the unveiling of a stablecoin by startup JPYC, indicating a growing interest in digital currencies within Japan’s financial sector.

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