Binance has announced plans to launch stablecoins denominated in the dollar, euro, and yen in Japan.
The initiative, set to take place next year, is made possible through a partnership with the trust banking arm of Mitsubishi UFJ Financial Group (MUFG), Takeshi Chino, the general manager of Binance Japan, said in an interview with Bloomberg.
Binance Japan aims to introduce these three stablecoins initially, with the potential for additional offerings in 2024.
As part of the collaboration, Binance and MUFG have already begun the process of studying the issuance and implementation of these stablecoins.
The announcement comes after Japan passed a law clarifying the legal status of stablecoins back in June.
Stablecoins are believed to offer advantages such as faster money transfers and settlements.
Japan’s Stablecoin Market Could Reach $34 Billion
Tatsuya Saito, MUFG’s vice president of products, has said that Japan’s stablecoin market has the potential to reach a substantial size of up to 5 trillion yen ($34 billion), approximately one-fourth of the estimated current global market.
MUFG has been engaged in discussions with multiple parties regarding the use of its blockchain platform, Progmat, to mint stablecoins tied to foreign currencies.
Meanwhile, to carry out its issuance plans, Binance will need to acquire a license in Japan as an electronic settlement methods transaction business provider, as outlined in the press release.
Once the stablecoins are introduced, users will have the ability to use them for cryptocurrency trading and potentially engage in payment services, according to Chino.
At the time, the exchange said it already offers Japanese crypto traders access to more tradable tokens than any other crypto exchange, with 30 tokens available for spot trading.
Financial Institutions Rush to Launch Stablecoins in Japan
The legalization of stablecoin issuance by licensed firms in Japan has prompted various companies to consider entering the market by launching these digital tokens.
For one, Orix Bank, a Japanese financial institution, is reportedly exploring the possibility of issuing stablecoins in the country.
Orix aims to commence testing stablecoins denominated in yen, dollar, and other currencies in October, with a target launch date in 2024.
These stablecoins will be backed by fiat deposits and utilize the Japan Open Chain blockchain, developed by Tokyo-based G.U. Technologies and its partners.
Likewise, Circle, the company behind the USDC stablecoin, has revealed plans to launch a stablecoin in Japan.
In July, Circle CEO Jeremy Allaire said that Japan would become an extremely large market for them if stablecoin adoption in cross-border trade and global commerce picks up in the coming time.