Three Japanese banks to test stablecoins on the Japan Open Chain

Tokyo Kiraboshi Financial Group, Minna no Bank and The Shikoku Bank will test stablecoins built on the Japan Open Chain blockchain, CoinDesk reports.

Financial institutions are deploying an infrastructure solution from GU Technologies for the experiment.

“We will conduct a study to confirm that each bank is capable of issuing its own ‘stablecoin’, which can be used in Ethereum wallets such as MetaMask, in compliance with the Payment Services Act,” the press release says.

Following Terra‘s collapse in 2022, Japanese authorities adopted a series of restrictive measures on stablecoins aimed at protecting investors. However, the government plans to permit listings of “stablecoins” issued outside the country on local exchanges.

The new rules, to be introduced in June, will allow local platforms to apply for a special license to trade stablecoins.

In January, Japan’s Financial Services Agency reached out to global regulators with a proposal to treat the cryptocurrency industry as stringently as banks.