Japan’s regulator backs joint stable coin project by three major banks

Japan’s regulator backs joint stable coin project by three major banks

Quick Take

• Japan’s Financial Services Agency has officially announced its support for a stable coin pilot project involving the country’s three major banks — Mizuho Bank, MUFG, and SMBC.
• The project is expected to examine how multiple banking groups can jointly issue so-called stable coin classified as electronic payment instruments under Japanese law.

Japan’s Financial Services Agency (FSA) has officially announced its support for a stable coin pilot project involving the country’s three major banks, as Japan continues to advance its efforts in payment innovation.

In a statement released Friday, the FSA said the experiment brings together Mizuho Bank, MUFG, and SMBC in a coordinated effort among the megabanks to jointly issue a stable coin for payments. The consortium also includes Mitsubishi Corporation, Progmat Inc., and Mitsubishi UFJ Trust and Banking Corporation.

According to the announcement, the project will examine how multiple banking groups can jointly issue so-called stable coin classified as “electronic payment instruments” under Japanese law, while ensuring regulatory compliance and proper operational practices.

The FSA said the project aims to verify whether such a system can be executed “lawfully and appropriately” in accordance with existing financial regulations.

The project is expected to run from November 2025 onward for the foreseeable future, the agency said. Results from the experiment, including legal and compliance insights, will later be published on the FSA’s website.

The pilot serves as the inaugural project under the FSA’s newly established Payment Innovation Project (PIP), a specialized initiative launched on Friday to accelerate blockchain-based payment innovations. PIP operates within the agency’s existing FinTech Proof-of-Concept Hub, which has supported fintech experiments since 2017.

The FSA’s announcement confirms details reported by Nikkei earlier this month. The collaboration is seen as a key step in modernizing Japan’s financial infrastructure and enabling faster, more efficient digital transactions across institutional networks.