Japani Megabank Mitsubishi UFJ Financial Group and domestic blockchain players say they have teamed up to launch a stablecoin interoperability pilot.
In a mitsubishi ufj press releaseThe firm’s trust and banking unit said it is partnering with Tokyo-based blockchain developer Datachain.
It will also work with a platform called Progmat Coin and developer Soramitsu.
latter Worked on Cambodian Central Bank Digital Currency (CBDC)Successfully released in 2020 with a coin.
Mitsubishi UFJ Trust and Banking announced their “technical collaboration” on March 28 to create a system for “seamless transfer and exchange” between various stable coins to be launched in Japan.
The bank said it will hold a series of “demonstrations” using “regional digital currencies” that are currently “under consideration for launch” at regional banks.
The pilot will use several Datachain-developed “interconnection” solutions.
These allow “different blockchains” to be linked.
The new pilot solution, the parties claimed, would allow parties to “increase efficiency” and “reduce fees for inter-bank, inter-company and mutual remittances” when using stable coins.
Why does the Mitsubishi UFJ have a stable currency of interest?
Last year, Japanese lawmakers voted in favor of stablecoin regulation clauses that have now been inserted into the amended Payment Services Act.
These volumes promulgated later this year. And they classify some stable coins as “electronic methods of payment” – effectively giving legal status to regulated stable coins.
This development will allow banks to launch their fiat-pegged coins on the blockchain network.
But as different banks are already working on different types of blockchain protocols, questions related to interoperability have been raised.
The Central Bank of Japan is also working prototype digital yen – which may also use blockchain technology.
Major Japanese business players are Expansion of in non-fungible tokens (nft) and the digital securities space – again creating potential interoperability problems.
Mitsubishi UFJ Trust and Banking suggested it will also look to improve the efficiency of cross-border remittances, adding that it is looking to reduce fees by exploring interoperability solutions for “foreign CBDCs”.
It claimed that its solution would “connect different blockchains in a secure and practical way” and create a “financial infrastructure that can be used globally.”
Last year, the bank announced its intention Launch “Digital Asset Wallet”.
The bank is part of Mitsubishi UFJ Financial Group – the largest bank in Japan and one of the largest financial groups in the world.
