MUFG Progmat Coin Platform picked to launch Japanese Bank-Backed Stablecoin

Empowering Japanese banks with Yen-pegged stablecoins, Mitsubishi UFJ Financial Group hasn't disclosed the first users of its platform; some other banks opt for a separate stablecoin solution

By Shashank Bhardwaj

Published: Jun 6, 2023 03:58:10 PM IST

Updated: Jun 6, 2023 03:59:25 PM IST

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Megabank Mitsubishi UFJ Financial Group (MUFG) has been chosen by banks in Japan to use its stablecoin issuance platform “Progmat Coin” for launching Japanese yen-pegged stablecoins on multiple public blockchains.

Japanese banks have recently stated their intentions of either looking into or launching stablecoins following the new regulations which came into effect this month.

The Japanese government passed a bill last year, which officially came into effect on June 1, 2023, restricting the issuance of stablecoins by non-banking institutions. MUFG’s Progmat Coin will be used to enable the issuance of bank-backed stablecoins on Ethereum, Polygon, Avalanche and Cosmos, with plans to add more networks in the future.

MUFG is collaborating with its blockchain tech and security partners Toki and Datachain to build a cross-chain bridge for secure and efficient transactions, lending and swaps across supported blockchains.

TOKI officially announced its collaboration with the bank via a Twitter thread which stated:

“The team is thrilled to announce that MUFG (Progmat), Datachain, and TOKI have teamed up to bring Japanese stablecoins to public blockchains.”

MUFG had initially announced Progmat Coin in February 2022 with an aim to provide an interoperable and “universal digital asset payment method” for stablecoins, other crypto assets, and even a Japan-based central digital bank currency.

While the list of banks which will use Progmat Coin have not been disclosed by MUFG, it confirmed in its 2022 announcement that it plans to develop its own Japanese yen-pegged stablecoin. This indicated the bank’s commitment towards growing digital asset solutions.

As per a report, Shikoku Bank, Tokyo Kiraboshi and Minna Bank all intend to issue stablecoins, but it seems that they won’t use the Progmat Coin platform to do so. The report stated that these banks will issue stablecoins using a separate stablecoin platform developed by G.U. Technologies, a Tokyo-based startup.

MUFG’s choice of Yen-pegged stablecoins showcases its trust in Progmat Coin, while the cross-chain development and choices of diverse platforms highlight the advancing landscape of digital assets in Japan.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash