Japan’s second-largest banking institution Mizuho bank is currently preparing the infrastructure to launch its stablecoin by March 2019, reports Asian Nikkei Review. The report suggests that the stablecoin will be pegged to the Japanese Yen. Furthermore, the stablecoin will also facilitate making cashless payments with no-fee transfers among its users.
The stablecoin aims at improving services for low-cost cross-border transfers and remittances. Mizuho’s digital currency service will provide direct competition to Japan’s local credit card companies. This will further help to promote more digital payments in the country while moving towards a cashless society.
Mizuho is also talking to 60 other regional banks to collaborate and support the liquidity for the stablecoin. Earlier in 2017, Mizuho Group chairman Yasuhiro Sato initially termed this as the “J-Coin” project. This project started by Mizuho bank included other regional banks, Japan post bank, and other Japanese “megabanks”. If things go as per the plans, this project will see the first instance of stablecoin mass adoption by banks, financial corporations, and retail users.
Cashless Payments to be Made Possible Using Simple QR Codes
Ahead of the 2020 Tokyo Olympics, Japan is planning to spearhead its cashless economy. In this regard, the Japanese government has introduced subsidies and tax breaks to encourage businesses to accept online payments.
The purported J-Coin project involving Mizuho’s stablecoin will have a simple QR code at vendor outlets to make cashless payments. The QR code could also be easily accessed through a dedicated smartphone application supporting the stablecoin. The Mizuho stablecoin will be pegged to the Japanese Yen in 1:1 ratio.
In addition to the Mizuho Bank, the Mitsubishi UFJ Financial Group also launched its MUFG stablecoin in April 2018. The financial group plans the nation-wide rollout of the MUFG stablecoin by 2020.
In future, the Mizuho stablecoin can also be used to give salary payments to the bank’s employees. It will also team up with China’s huge online payment platform Alipay which allows payments using QR codes. This will also allow foreigners to easily make payments in Japan.
During his interview with The Yomiuri Shimbun, Mizuho Financial Group President Tatsufumi Sakai said:
“The business of financial settlements has become more important and is expected to continue to grow. So we have to take a serious approach.”
The president also said that it will leverage the data from new payment services for its future businesses. Mizuho is currently pursuing cross-industry alliances with several other IT companies.
“We’ll do business with other companies if we have the opportunity. Timing and speed are very important. There is a limit to how much we as a financial institution can develop just through our conventional businesses. We’re focusing on new technology,” Sakai said.