A group of Japanese bankers from Tokyo’s Kiraboshi Financial Group, Minna Bank, and Shikoku Bank will be participating in the testing of stablecoins on the Japan Open Chain blockchain.
The blockchain developer, G.U. Technologies, released this information. From May 6, Japan will lift the ban on transactions with stablecoins pegged to the exchange rate.
However, new regulations require issuers to provide collateral assets as confirmation for issuing stablecoins within the country.
The first phase of the testing process involves issuing coins and conducting transactions within banks. The next stage aims to introduce stablecoins that meet all legal requirements.
The banks expressed their joint press release that “the goal of our experiment is to prove that any bank is capable of issuing a stablecoin backed by the Ethereum ecosystem, including the MetaMask wallet.” Japan Open Chain is entirely compatible with the Ethereum ecosystem.
This Japanese blockchain was created by GU Technologies in collaboration with the Pixiv internet community, Dentsu advertising and communications holding, Minna Bank digital bank, Kyoto University of the Arts, and technology firm CORGEAR. Earlier, Japanese authorities had announced their return to the project of creating a digital yen and confirmed its launch in April.
The central bank would conduct simulated transactions with private financial institutions in a test environment as part of the pilot program. However, there would be no actual deals between retailers and consumers at this time.
The Bank of Japan has already tested the state digital yen, but they suspended work on the project in August. Officials determined that citizens have a regular banking system, so there is no need to expand access to financial services from a political or economic standpoint.