**Japan’s Largest Banks to Launch Yen-Based Stablecoin Pilot Approved by FSA**
*Date: November 7, 2025*
Japan is set to take a significant step in modernizing its financial infrastructure with a newly approved pilot program to issue yen-based digital tokens. The initiative, backed and supervised by the Financial Services Agency (FSA), brings together the country’s three largest banks—Mizuho Bank, MUFG, and Sumitomo Mitsui Banking Corporation (SMBC)—in a joint effort to test a stablecoin designed for corporate and consumer payment systems.
### A Consortium at the Forefront of Innovation
The pilot program involves a consortium that includes Mitsubishi Corporation, Progmat Inc., and Mitsubishi UFJ Trust and Banking Corporation. Together, these institutions will issue yen-based digital tokens as part of the trial, leveraging MUFG’s established Progmat platform. Progmat is a blockchain network currently utilized for trading tokenized securities and asset-backed products.
By collaborating, the banks aim to explore whether a unified digital payment infrastructure run by multiple traditional financial institutions can streamline transactions, reduce costs, and improve transaction speeds.
### Backed by Japan’s Payment Regulator
The FSA has given its official approval and will supervise the pilot as a key component of its newly launched Payment Innovation Project (PIP). This project focuses on the issuance and management of stablecoins categorized as electronic payment instruments under Japanese law.
This pilot is the first initiative under PIP, which operates within the broader FinTech Proof-of-Concept Hub established in 2017—a central platform for testing new financial technologies in Japan.
### Overhauling Corporate Settlement Systems
Mizuho, MUFG, and SMBC collectively serve more than 300,000 corporate clients, many of whom still depend largely on traditional clearing systems. The stablecoin trial will test whether digital tokens can enhance efficiency in interbank transfers and cross-company payments, maintaining security and regulatory compliance.
If successful, the pilot could significantly reform corporate settlement frameworks in Japan, demonstrating the viability of blockchain integration into conventional banking.
### Japan’s Position in the Global Digital Finance Race
As stablecoins gain increasing traction in the United States and Europe, Japan’s proactive approach signals its commitment to remaining competitive within the global digital finance landscape. With regulatory backing from the FSA, this stablecoin pilot represents a pivotal move toward a financial infrastructure that is more efficient, transparent, and innovation-driven—where blockchain technology and traditional finance converge.
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**About the Author:**
*Jared Kirui* is an experienced financial journalist with a passion for forex and CFDs. He has authored over 2,300 articles and follows developments across global finance markets closely.
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https://www.financemagnates.com/cryptocurrency/japans-top-banks-team-up-to-test-stablecoin-backed-by-national-regulator/
