Mitsubishi UFJ Financial Group, the largest bank in Japan, is collaborating with Solamitsu and Datachain to make the domestic stablecoin, Progmat Coin, interoperable. The bank believes the interoperability will cause an improvement in settlement times and a reduction in associated fees.
According to local media outlets, the aim is to enable the seamless transfer and exchange of a diverse range of domestically issued stablecoins.
Streamlining Remittances And Transfers
The Progmat Coin, the stablecoin for the project, operates on the Hyperledger Iroha platform. The parties claim that integrating this stablecoin with local financial institutions will enhance its interoperability.
Moreover, enterprises plan to utilize the permissioned blockchain network of Hyperledger Iroha. The report read, “as a consequence, there will be a diverse array of stablecoins, enabling seamless exchanges and transfers among regional digital currencies launched by countries and central banks. This development will facilitate the streamlining of personal, interbank, and business-to-business remittances.”
Additionally, the development focus will shift towards cross-border remittances and cost reduction, incorporating foreign CBDCs. Japan is expected to pass a bill on stablecoins this year, part of which will enable its banks to launch stablecoins.
Meanwhile, the Progmat Coin was unveiled in 2022 to optimize settlement procedures. The stablecoin is more than just a settlement tool; it may also be integrated into other networks.
Additionally, its ability to facilitate cross-border exchanges and remittances with other CBDCs further expands its applications. In addition, Progmat functions as a platform, and there are reports that a utility token is currently in development.
As development progresses, there may be a shift towards NFTs and other cryptocurrencies.
Japan’s Attraction To Web3
With Japan drawing in web3 expertise, the potential use cases for this stablecoin could broaden with time. Furthermore, Mitsubishi Bank has been intensifying its initiatives in cryptocurrencies and blockchain technology.
For example, Japan may soon authorize 13 registered trust banks, including Mitsubishi, to provide cryptocurrency custody services. However, legislators are eager to ensure investors in these services are protected, particularly in the aftermath of last year’s UST collapse.
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