Yen-Backed Stablecoin Can’t Come at a Better Time as BOJ Seen Raising Rates
The timing for this development couldn’t be better, as the Bank of Japan (BOJ) is widely expected to raise interest rates soon, a move likely to increase the appeal of both the yen and yen-backed assets
One of the biggest stories emerging from the Far East this month is the imminent launch of a blockchain-based version of the Japanese yen, one of the world’s major fiat currencies.
The timing for this development couldn’t be better, as the Bank of Japan (BOJ) is widely expected to raise interest rates soon, a move likely to increase the appeal of both the yen and yen-backed assets.
Earlier this month, CoinDesk reported that Japan’s Financial Services Agency (FSA) is likely to approve the country’s first yen-denominated stablecoin as early as this fall. According to the report, Tokyo-based fintech firm JPYC plans to register as a money transfer business within the month and will spearhead the rollout of a JPY-pegged stablecoin, which will trade at a 1:1 ratio with the Japanese yen.
Stablecoins are cryptocurrencies that are pegged to an external reference, such as the U.S. dollar, euro, or yen. These tokens play a crucial role by facilitating capital transfers used for trading, investing, remittances, or international payments, all while bypassing the volatility typically associated with other cryptocurrencies.
JPYC is not alone in pursuing a yen-pegged stablecoin. Last week, Tokyo-based financial services company Monex Group announced that it is considering launching its own JPY stablecoin aimed at international remittances and corporate settlements. Oki Matsumoto, Chairman of Monex Group, told local media, “Issuing stablecoins requires significant infrastructure and capital, but if we don’t handle them, we’ll be left behind.”
