Japan’s three megabanks finish yen stablecoin trial with Mitsubishi, aim for real payments by March 2027

Japan’s three megabanks have finished their first live test of a jointly issued yen stablecoin. Mizuho Bank, MUFG Bank and Sumitomo Mitsui Banking Corporation (SMBC) said on 16 October 2026 that a deposit-backed token moved between Mitsubishi Corporation’s offices in Japan and abroad from 17 to 23 July, according to a joint release published by TISI, the Japanese IT company that integrated the systems. Mitsubishi UFJ Trust and Banking acted as trustee. No amounts, transfer counts or token name were disclosed.

The banks say the joint-issuance model works, and they are keeping the target they set in June: real transactions with the coin within fiscal 2026, which ends on 31 March 2027.

This Japan bank stablecoin is not the kind of coin a reader can buy on an exchange. It is a closed instrument for corporate customers who have passed the banks’ identity checks, legally closer to tokenised bank money than to JPYC, USDC or USDT. What is new is the set-up: Japan’s three biggest banks tested one shared token, rather than three separate ones.

What the Japan bank stablecoin trial tested in July

Five companies took part: the three banks, Mitsubishi UFJ Trust and Banking (MUFG Trust) as trustee, and TISI Inc. Mitsubishi Corporation was the user, sending the token between its domestic and overseas offices. The release itself is dated 16 October and was updated at 14:00 Japan time, about 05:00 UTC. Japanese outlet CoinPost reported the results the same evening.

According to the release, the participants checked the following:

• the full cycle of issuance, transfer and redemption of the token;
• running one scheme with several banks acting as issuers at the same time;
• anti-money-laundering and counter-terrorist-financing (AML/CFT) measures for different use cases, and how well the systems performed;
• each bank’s regulatory and practical obligations, and the trustee’s duties: user protection, managing the trust assets, and the issuance and redemption procedures.

The results are stated in general terms. The banks said they gained practical knowledge of issuing and circulating the coin and confirmed “the safety and reliability of the system”, as well as the feasibility of joint issuance (our translation from the Japanese release; no English version was published). No executive was quoted, and no figure on speed, cost or volume came with the announcement.

Three banks as joint settlors, one trust bank holding the money

The legal set-up is what makes this coin different from most stablecoins. Mizuho, MUFG Bank and SMBC are joint settlors under a single trust agreement, and MUFG Trust is the trustee. What circulates is a “specified trust beneficiary right” under Article 2(9) of Japan’s Payment Services Act. Legally, that makes it an electronic payment instrument, not a crypto asset, CoinPost noted.

The release also sets out a design concept for the live product. The banks call it tentative and subject to change. As it stands:

• issuing jointly gives the coin reach across the customer bases of all three banks;
• the trust structure has no cap on the amount in circulation, so it can be used at scale;
• the trust assets are held as bank deposits, to keep the price stable;
• only users who have passed the banks’ identity checks can hold or move the token.

The second point matters more than it looks. Stablecoins issued in Japan by registered funds-transfer firms are limited to ¥1 million per transfer, CoinPost noted in a related summary. The trust route avoids that limit, which is why it suits a trading house moving money between subsidiaries.

SMBC supplied the blockchain; Progmat is absent from the October releases

On the technical side, SMBC provided the blockchain base to the other participants; it had commissioned TISI to build it. TISI, the company created on 1 July 2026 by the merger of TIS and Intec, also connected the issuance system to the wallet system. None of the releases names the chain, or says whether it is public or permissioned.

One detail differs from earlier reporting. When Japan’s Financial Services Agency backed the project in November 2025, the applicants listed were the three banks, Mitsubishi Corporation, MUFG Trust and Progmat, Inc., the tokenisation platform spun out of MUFG Trust in 2023. Nikkei, as relayed by ForkLog, had reported that the coin would use Progmat Coin. The 16 October releases name TISI and an SMBC-supplied chain and do not mention Progmat at all. The banks have not commented on the difference.

From a Nikkei report to FSA backing: twelve months of steps

Nikkei first reported the joint coin in October 2025. On 7 November 2025 the FSA said it would support the project as the first case of its Payment Innovation Project (PIP) and the 11th case of its FinTech PoC Hub. The regulator assessed it on five criteria: clarity, social significance, innovation, user protection and feasibility. Its support runs from November 2025 “for the time being”, and it has said it will publish the compliance and supervisory issues, and the points of legal interpretation, found during the test. We found no such publication as of 17 October.

In 2026 the pace picked up. The releases point back to a 13 February announcement of a test on trading and transferring traditional assets with blockchain and digital money. On 10 June the three banks set up a joint council and announced the fiscal 2026 target, with a trust structure and “a trust bank or similar institution” as trustee, Decrypt reported. The July pilot followed. On 29 September the banks announced a separate trade-payment test on the TradeWaltz platform, an FSA-backed project in which NTT Data and Mizuho are among six firms.

How a bank stablecoin differs from JPYC and USDC

A stablecoin is a token meant to hold a steady value against a currency. Japan created its own category for them in Payment Services Act amendments that took effect in June 2023: “electronic payment instruments”, which only banks, registered funds-transfer firms and trust companies may issue. The megabank coin uses the trust route. A trustee holds the reserve, and the token circulates only among verified bank customers.

JPYC took the funds-transfer route. It registered in August 2025 and on 27 October 2025 launched what The Block described as the country’s first legally recognised yen-backed stablecoin, on Ethereum, Avalanche and Polygon, backed by yen deposits and Japanese government bonds, with My Number ID checks for users. JPYC aims for ¥10 trillion in circulation within three years, and announced on 2 June 2026 that cumulative issuance had passed ¥3 billion, research firm 4Pillars reported.

Dollar coins arrived too. USDC became the first dollar stablecoin approved in Japan in March 2025, distributed by the SBI group. Amended FSA rules in force since 1 June 2026 move foreign trust-type stablecoins such as USDC out of the securities category and into electronic payment instruments, 4Pillars noted. Other yen projects followed: SBI and Startale unveiled JPYSC in February 2026, and the Japan Blockchain Foundation announced EJPY in May, according to Decrypt. SMBC had also explored a stablecoin of its own with Ava Labs and Fireblocks in April 2025.

Why joint issuance? A company paid in one bank’s token would otherwise need that bank to redeem it. One coin accepted across three bank networks avoids splitting corporate payments into incompatible pools. Our beginner’s guide to stablecoins explains the reserve models in more detail.

Cross-border payments first, real transactions before March 2027

The pilot’s use case was narrow: one trading house paying between its own offices in Japan and abroad. Both ends of every transfer belonged to the same company, a customer the banks already know, which keeps the identity checks simple for a first run.

The next steps in the release are concrete. The banks will list the issues to solve before practical use. They will keep working with Japanese and foreign authorities, financial institutions, companies and technology providers on user protection, AML/CFT, cybersecurity and system stability. Through the joint council set up in June, they plan to start real transactions with the jointly issued stablecoin within fiscal 2026.

Europe’s banks are building their own euro coin

European readers will not see the yen coin: it is not offered in the EU and is limited to the banks’ verified customers. The closest European project is Qivalis, a consortium of banks that plans a euro stablecoin under MiCA in the second half of 2026. UniCredit, ING and CaixaBank are among the nine founding banks, and BNP Paribas joined on 1 December 2025. Qivalis’s website says De Nederlandsche Bank has authorised it as an electronic money institution, though it does not yet issue e-money to the public. In the meantime, EU platforms are clearing out tokens without MiCA status, as covered in our piece on ESMA’s January deadline for non-MiCA stablecoins.

Not everyone thinks banks will lead. Circle chief executive Jeremy Allaire says banks are “no longer in charge”, as we reported on 16 October in our story on Circle’s push into about 40 more markets. In the United States, the GENIUS Act takes effect on 18 January 2027, a few weeks before the Japanese banks’ own deadline.

What the banks have not disclosed

• which blockchain was used, and whether it is public or permissioned;
• the token’s name or ticker;
• how much was issued and transferred in July, how many transfers took place, and any cost or settlement-time gains;
• Progmat’s current role, if any;
• the final reserve design (deposits are “tentative”), fees, and whether retail users will ever get access (none is planned);
• the exact launch date within fiscal 2026, and when the FSA will publish its PIP conclusions.

CoinPost has mentioned a dollar-denominated version as under consideration, but it is not in the joint release and remains unconfirmed. The next fixed date is the end of Japan’s fiscal year on 31 March 2027, by which the three banks say real payments will have started.