Circle is considering issuing a stablecoin in Japan, given that legislation governing stablecoins took effect on June 1, the payment services company's co-founder and CEO Jeremy Allaire said.
Japan's stablecoin bill makes it one of the first countries to establish a framework for the use of overseas stablecoins, which Allaire considers “the most important thing the government and the Financial Services Agency have done.”
Japan is one of the first major economies to pass a law specific to stablecoins. The bill provides clarity around the definition of stablecoins, which will now be considered as digital money and must be linked to the yen or another legal tender, guaranteeing holders the right to redeem them at face value.
Stablecoins can now only be issued by licensed banks, registered money transfer agents and trust companies. The bill does not address existing asset-backed or algorithmic stablecoins. However, exchanges in Japan do not list stablecoins.
Major Japanese financial institutions have been exploring stablecoins, with Mitsubishi UFJ Trust and Banking Corporation announcing its plans to issue its own stablecoin platform, called Progmat.
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