What to know:
- MUFG, Mizuho, and SMBC target stablecoin transactions launch by 2027.
- Japan’s banking consortium advances from pilot testing toward commercial deployment.
- Regulatory reforms and rising competition accelerate Japan’s stablecoin market.
MUFG Bank, Mizuho Bank, and Sumitomo Mitsui Banking Corporation plan to begin commercial stablecoin transactions by March 2027 through a jointly issued digital currency initiative. According to the three banking groups, the stablecoin will be issued under a trust structure, with each institution acting as a joint settlor while a trust bank or similar financial institution serves as the project’s trustee.
Moreover, the banks intend to launch live stablecoin transactions during fiscal year 2026, which runs through March 2027. They stated that the initiative could support a broad range of future payment and settlement use cases.
In preparation for the launch, the institutions have agreed to establish a council that will examine governance standards and operational frameworks. The group will help develop the infrastructure required before the stablecoin enters commercial use.
The announcement marks the latest milestone in a collaboration that began last year. In October, the three banks started a pilot project to evaluate how multiple banking groups could jointly issue stablecoins under Japan’s regulatory framework.
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Banking Groups Move Toward Commercial Deployment
The pilot focused on stablecoins classified as electronic payment instruments under Japanese law. Participants examined whether a jointly issued model could operate efficiently while meeting legal requirements.
Japan’s Financial Services Agency supported the initiative in November. The regulator said the project would verify whether such a system could function lawfully and appropriately within existing financial regulations.
Additionally, the stablecoin initiative became part of the FSA’s FinTech Proof-of-Concept Hub, a program that has supported financial technology projects and industry testing since 2017. The latest announcement indicates that the participating banks are now shifting from the testing phase toward practical implementation. As a result, commercial transactions have become the project’s next major objective.
Regulatory Reforms Drive Stablecoin Adoption
Japan’s stablecoin market has expanded steadily since regulatory changes took effect in 2023. Amendments to the Payment Services Act introduced the concept of electronic payment instruments and provided legal clarity for issuers. Consequently, banks and registered service providers gained a clearer pathway to issue and manage stablecoins within the country.
JPYC Inc. launched Japan’s first legally recognized yen-denominated stablecoin in October 2025. Earlier this year, SBI Holdings and Startale Group introduced JPYSC, a trust bank-backed stablecoin designed for institutional and cross-border transactions.
Growing Competition in Japan’s Stablecoin Market
Interest in yen-backed stablecoins continues to increase across the financial sector, with the Japan Blockchain Foundation announcing plans last month to issue EJPY on both Japan Open Chain and Ethereum.
Japan’s three largest banks are now preparing to enter the market with their own jointly issued stablecoin. Their planned launch could expand commercial adoption while strengthening the role of regulated digital assets in the country’s payment ecosystem.
In conclusion, the project highlights the growing involvement of major financial institutions in Japan’s stablecoin sector as commercial deployment moves closer to reality.
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