Mitsubishi UFJ Financial Group (MUFG) – the largest finance institution in Japan – is reportedly considering issuing global stablecoins via its blockchain platform. 

The bank has previously revealed plans to introduce such tokens tied to the value of the Japanese yen. 

MUFG’s New Crypto Idea

As reported by Bloomberg, the entity is in talks with industry leaders and other companies on minting stablecoins pegged to foreign currencies, such as the US dollar. To do so, it intends to use its blockchain platform Progmat, Vice President of Product Tatsuya Saito said.

The executive added that potential partners in the move are several local financial institutions, entertainment firms, and other non-financial businesses. Inquiries also come from foreign organizations, meaning Japan could become a global hub for stablecoins, Saito envisioned. 

Such financial products have been the subject of enhanced scrutiny in the Asian country, especially after the collapse of the algorithmic stablecoin UST last year, which triggered multi-billion investor losses. 

The Japanese authorities recognized stablecoins as digital money but said they could only be issued by licensed banks, money transfer agents, or trust companies. Saito praised the recently-enforced legislation, maintaining it could bring additional consumer protection:

“Issuers and users can feel safe using stablecoins.”