Japan’s Three Major Banks Join Forces to Issue a Stablecoin! MUFG, SMBC, and Mizuho Complete Cross-Border Payment Tests, with Commercial Launch Possible as Early as 2027

Japan’s three major financial groups have officially taken an important step toward the commercial use of stablecoins!
MUFG Bank, Sumitomo Mitsui Banking Corporation (SMBC), and Mizuho Bank jointly announced on the 16th that they had completed a proof of concept (PoC) for the joint issuance of a yen stablecoin and cross-border corporate payments, successfully testing the issuance, transfer, and redemption processes. The three banks also plan to launch actual transactions within Japan’s 2026 fiscal year, by the end of March 2027, signaling that Japan’s banking sector is accelerating efforts to bring cross-border corporate payments onto the blockchain.
Japan’s three megabanks team up to complete cross-border payment test for yen stablecoin
According to an official announcement, the test was conducted from July 17 to 23 this year. MUFG, SMBC and Mizuho Bank jointly designed the issuance model, Mitsubishi UFJ Trust and Banking Corporation managed the trust, and TISI provided blockchain and wallet system integration.
The test used fund transfers between Mitsubishi Corporation’s domestic and overseas locations as a use case, verifying the end-to-end process of issuing, transferring and redeeming stablecoins.
The participating institutions said the test confirmed the technical feasibility and system security of a stablecoin model jointly issued by multiple banks. It also examined regulatory compliance and anti-money laundering measures for cross-border transactions.
The project’s key feature is that three banks that traditionally compete with one another are seeking to establish a yen stablecoin that they can jointly issue and circulate across banks. Under the design announced by the authorities, the stablecoin will use a specific trust beneficiary rights structure recognized under Japan’s Payment Services Act. The three banks will jointly participate in issuance, while Mitsubishi UFJ Trust and Banking Corporation will manage the trust assets.
Its main features include:
Joint issuance: Combining the customer bases of the three megabanks to expand the stablecoin’s circulation.
Trust asset backing: Trust assets managed through bank deposits will support the stablecoin’s value.
Compliant circulation: In principle, use will be limited to eligible users who have completed identity verification.
Business payments: Prioritizing cross-border remittances, intra-group fund transfers and corporate settlements.
The authorities also noted that the trust-based issuance structure is designed without a general circulation limit, leaving room for large-scale corporate use in the future. However, this does not mean stablecoins can be issued without limit and without corresponding asset backing.
Aiming for commercial launch by the end of March 2027, but regulatory and cybersecurity challenges remain
Japan’s three megabanks announced plans to jointly issue a stablecoin as early as June this year, with the goal of launching live transactions within fiscal 2026.
The completion of the proof of concept means the project has passed a stage demonstrating its technical and business feasibility. However, issues remain, including establishing a formal operating framework, protecting corporate users, anti-money laundering, cybersecurity and cross-border regulations.
The official announcement has not yet specified a launch date, nor disclosed the planned commercial issuance volume, transaction fees or the actual time savings for cross-border remittances.
Global stablecoin market capitalization at about $302.9 billion as Japanese banks accelerate their push
As Japan’s banking sector accelerates its efforts, the global stablecoin market remains dominated by dollar-backed stablecoins. This shows that dollar stablecoins still command the largest share of the global market. If the yen stablecoin from Japan’s three megabanks succeeds commercially, it could offer businesses an alternative cross-border funds transfer tool backed by Japan’s financial regulatory system.
However, the three banks have not yet announced an official issuance volume, so the size of the global stablecoin market should not be treated as the potential revenue of this yen stablecoin project.
Unlike stablecoins primarily serving crypto trading markets, Japan’s three megabanks are focusing this initiative on the day-to-day cash management needs of multinational companies.
If it succeeds commercially, businesses may be able to transfer funds between different banks and overseas locations through a shared stablecoin system, while using smart contracts to improve the efficiency of settlement and accounting processes.
However, the actual commercial value remains to be proven, including whether cross-border transfer costs can be reduced, settlement times shortened and businesses persuaded to adopt the system at scale.
For Japan’s financial industry, the most important takeaway from the completed test is that the three megabanks have demonstrated the technical and operational feasibility of jointly issuing a yen stablecoin. The next step is to determine whether it can truly become part of the commercial financial system.
"Japan’s three megabanks join forces to issue a stablecoin! MUFG, SMBC and Mizuho complete cross-border payment test, with commercial launch possible as early as 2027" This article was first published on BlockTempo.