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Circle’s USDC Receives Regulatory Approval for Japan Launch on March 26
In a significant development, Circle has announced that its US Dollar Coin (USDC) stablecoin has received regulatory approval in Japan. This breakthrough marks the first time a global dollar stablecoin has been approved by Japanese authorities.
The launch of USDC in Japan will be done in partnership with SBI Holdings, a leading financial services company. According to Jeremy Allaire, CEO of Circle, this strategic collaboration will open up new opportunities in the areas of payments, cross-border finance and commerce, as well as foreign exchange.
SBI Holdings’ CEO Yoshitaka Kitao also expressed his enthusiasm for the launch, stating that it would enhance financial accessibility and drive crypto innovation in Japan’s evolving digital economy. He emphasized that this aligns with SBI’s broader vision to push forward blockchain-based finance.
Key features of USDC include its 100% backing by cash and cash-equivalent assets, held at regulated financial institutions. This level of transparency aims to build trust among Japanese businesses and consumers.
Jay Jo, a senior research analyst at Tiger Research, believes that Japanese companies could leverage this approval to offer custody services and develop stablecoin-based business models. However, he noted that Japan still prohibits the creation of trust-based yen stablecoins. Future regulatory changes may impact the country’s crypto landscape.
The ongoing weakness of the Japanese yen might create interesting market dynamics. Jo suggested that if the yen continues to show weakness, Japanese investors might shift their focus to USDC as a hedge, potentially increasing selling pressure on JPY. This could accelerate outflows from traditional yen investments.
USDC currently holds the second-largest stablecoin by market capitalization with a cap of $59.7 billion, according to CoinGecko data. The dollar-backed USDT is still the largest, boasting a cap of $143.8 billion.
The approval in Japan follows Circle’s earlier recognition of both USDC and EURC under the Dubai Financial Services Authority’s new regime. This allows businesses within the Dubai International Financial Centre to incorporate these stablecoins into digital asset applications, including payments and treasury management.
In conclusion, this regulatory approval marks a significant milestone for Circle and SBI Holdings. The potential benefits include improved financial accessibility, enhanced cross-border transactions, and increased trust in blockchain-based finance.
Source: https://coincentral.com/circles-usdc-receives-regulatory-approval-for-japan-launch-on-march-26/
