Japan's Major Banks Plan Joint Stablecoin Issue by March 2027

Japan's three largest banks—Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group—are preparing to jointly issue a stablecoin by March 2027. They will establish a council to explore the necessary operational frameworks required for this issuance.

The stablecoin will operate under a structure where the three banks serve as "joint settlors," and a trust bank or a similar institution will act as the trustee. This initiative follows a sign of support from Japan's Financial Services Agency (FSA) in November 2025, alongside recent endorsements from the ruling Liberal Democratic Party (LDP) for promoting yen-based stablecoins.

Stablecoins are digital assets pegged to traditional financial instruments, typically fiat currencies. Currently, the stablecoin market is dominated by tokens like Tether's USDT and Circle's USDC, which together hold 84% of the market share. In contrast, yen-pegged stablecoins form a marginal element of the market, amounting to less than $50 million within the total $311 billion sector, with Japan's most notable stablecoin, JPYC, holding a market cap of approximately $18 million.