Japan's Largest Bank Working on Yen Stablecoin Interoperability

In Brief

• Mitsubishi UFJ Financial Group is working with Datachain and Solamitsu to make an interoperable Yen-backed stablecoin.
• Progmat Coin is a yen-backed stablecoin that will have multiple use cases.
• Japan has been changing its stance on crypto, and a new stablecoin bill will come into effect this year.
  

The Mitsubishi UFJ Financial Group, Datachain, and Solamitsu are working on making the Progmat Coin, a Yen-backed stablecoin, interoperable. Expectations are that it will improve settlement times and reduce associated fees.

Mitsubishi UFJ Financial Group, Japan’s largest bank, has started development to make a domestic stablecoin interoperable. Local media outlets report that the bank is working with Datachain and Solamitsu “to realize a smooth mutual transfer and exchange between a wide variety of table coins to be issued domestically.”

Stablecoin Interoperability To Streamline Remittances
The stablecoin in question is called the Progmat Coin and uses the Hyperledger Iroha. The parties state that the interoperability of this stablecoin with domestic financial institutions will improve exchange. Businesses intend to use Hyperledger Iroha, a permissioned blockchain network. The report reads,

“This will result in a wide variety of stablecoins and smooth mutual transfers and exchanges between regional digital currencies that will be issued by various banks and other countries, and will be able to streamline interbank, business-to-business and personal remittances.”

In the future, development efforts will shift towards cross-border remittances and reducing fees and will involve foreign central bank digital currencies (CBDCs). Japan expects to implement a bill on stablecoins in 2023, which would allow banks to issue stablecoins.

Progmat Coin Could Have Extensive Use Cases
The Progmat Coin was first announced in 2022 to streamline settlement processes. However, Progmat is more than just a settlement solution, as it may also feature on other networks. The fact that it will allow cross-border remittances and exchanges with other CBDCs adds to its use cases.

Progmat is also a platform, with a utility token reportedly in the works. Development may also eventually focus on NFTs and other crypto assets. Considering Japan is attracting web3 talent, the stablecoin may see much more expansive use cases in the future.

Mitsubishi and Others Move Deeper Into Crypto
The Mitsubishi bank has been ramping up its efforts with respect to blockchain technology and cryptocurrencies. For instance, the country could soon allow 13 registered trust banks, including this one, to offer crypto custody services. While lawmakers are keen to ensure investor protection during these developments, especially after the downfall of UST.

In more recent news, China’s Alibaba announced a web3 incubator in Japan that will see Tokyu Land Corporation and Skeleton Crew Studio collaborate. Later, it will introduce a blockchain node service.

Disclaimer
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.