Japanese Banks Continue to Embrace Stablecoin Innovation

Sony Bank, a Japanese commercial bank from Sony Financial Group, has launched a proof-of-concept experiment to develop a stablecoin pegged to fiat currencies, including the Japanese yen.

The initiative aims to explore the potential of stablecoins for streamlining payments and remittances within the Sony Group’s diverse ecosystem, which spans gaming, sports, and other intellectual properties.

Sony Seeks to Enhance User Experiences by Leveraging Stablecoins

According to Nikkei’s report, Sony Bank’s experiment will leverage the Polygon blockchain, known for its scalability and low transaction fees. Additionally, Sony Bank has partnered with SettleMint, a Belgian blockchain development firm, to facilitate the project’s technical execution.

The trial is expected to run for several months and address potential legal considerations surrounding yen-backed stablecoin transfers.

Sony seeks to harness stablecoins to enhance the user experience within its content offerings. Consequently, the company could facilitate the seamless trade of digital assets for Sony’s gaming and entertainment platforms by using stablecoins.

This move aligns with Sony Bank’s upcoming “Sony Bank Connect” app launch. The app provides a user-friendly environment for managing digital assets, including NFTs (non-fungible tokens).

Read more: A Guide to the Best Stablecoins in 2024

In a related development, Sota Watanabe, CEO of Startale Labs and founder of Astar Network, revealed plans for a deeper integration with Sony.

“Sony Bank plans to launch stablecoin and Sony plans to launch a blockchain with us [Startale and Astar Network]. It is getting ready,” Watanabe wrote on his X (formerly Twitter) account.

Sony and Startale have a history of partnership. In September 2023, Sony Network Communications Inc. invested $3.5 million in Startale Labs. The partnership aims to establish a global web3 infrastructure, leveraging Sony’s extensive experience in telecommunications and other sectors as well.

Positive Regulatory Environment for the Crypto and Web3 Sectors

Sony Bank’s venture towards embracing stablecoin technology is notable as part of a larger movement within Japan’s banking sector.

Read more: Stablecoin Regulations Around the World

In November 2023, Mitsubishi UFJ Trust Bank, a major Japanese bank, partnered with Progmat and Ginco for trials on stablecoin infrastructure. Meanwhile, Hokkoku Bank recently debuted “Tochika,” Japan’s first deposit-backed stablecoin, offering users increased convenience in spending.

Several other Japanese banks have also conducted trials on stablecoin-based electronic money transfers.

The booming stablecoin sector in Japan benefits from the country’s progressive regulatory framework. In June 2023, Japan legalized stablecoins pegged to fiat currencies and permitted licensed financial institutions to issue them. Moreover, the government lifted the ban on foreign stablecoins.

In addition to its favorable stablecoin regulations, Japan also has a positive regulatory environment for the crypto and Web3 industry. BeInCrypto previously reported in February Japan paves the way for Web3 and crypto initiatives amid an overhaul in its investment laws.

This goal is to turbocharge the nation’s tech sector, specifically targeting venture capital (VC) investments in crypto and web3 startups.