Mitsubishi UFJ Trust, Japan’s largest bank by assets, is planning to issue a stablecoin pegged to the yen under the revised Settlements and Payment System Act taking effect next year, according to Nikkei.
The stablecoin Progmacoin will be used for clearing and settlements of digital securities. It is intended to provide instant settlement of securities trades by utilizing the blockchain for trading and a cryptocurrency for payment, according to the report.
Mitsubishi UFJ Trust has partnered with SBI and Daiwa Securities to drive of use of blockchain-based securities. Progmacoin will be used in the settlement of digital securities on the SBI and SMBC digital securities exchange, which are anticipated to go live sometime in 2022.
According to a December PYMNTS report, Japan’s Financial Services Agency (FSA) revised legislation to allow only banks and wire transfer companies to issue stablecoins.
Under the revised law, Japanese financial institutions will likely have the option of issuing stablecoins in the country for the settlement of securities transactions. Currently, the settlement of securities transactions takes several days with high overhead.
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The Mitsubishi UFJ Financial Group (MUFG) is among the world’s largest financial groups and is listed on the Tokyo, Nagoya and New York stock exchanges. The group includes MUFG Bank, Ltd., Mitsubishi UFJ Trust and Banking Corporation, Mitsubishi UFJ Securities Holdings Co., Ltd., Mitsubishi UFJ NICOS Co., Ltd. and Mitsubishi UFJ Lease & Finance Company Limited.
MUFG offers commercial banking, trust banking, securities, credit cards, consumer finance, asset management, leasing and other financial services. The banking group has the largest overseas network of any Japanese bank, with offices and subsidiaries across 50-plus countries.
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