Forecast Trend Report by Period
A startup, rather than a major financial institution, was able to become Japan’s first issuer of a yen-denominated stablecoin because of its early operating experience and the government’s push for financial innovation and startup growth, JPYC said.
Shota Saito, head of business development and marketing at JPYC, made the remarks on August 21 at a forum in Seoul’s National Assembly Members’ Office Building titled “The Great Shift in Financial Order and the Formula for Successfully Issuing K-Stablecoins.” He said startups were able to lead Japan’s stablecoin business because JPYC had already been issuing prepaid payment instruments, making it “a presence that could not be ignored.”
The comments came in response to a question from Min Byung-deok, a lawmaker from the Democratic Party, about how startups in Japan were able to enter the stablecoin business ahead of incumbent financial players such as banks. The question reflected South Korea’s ongoing debate over who should be allowed to issue won-denominated stablecoins, with bank-centered issuance emerging as a key issue, and expressed envy of Japan’s example.
Saito said the Japanese government broadly favored supporting startups in the name of financial innovation. In that environment, early precedents emerged among related businesses. That later helped form multiple issuance models, including one based on funds transfer service providers and a trust-based model involving traditional financial firms such as SBI.
In Japan, stablecoin issuance was not limited to existing financial institutions startups’ earlier business experience was absorbed into the regulatory framework, allowing a range of issuance models to emerge. As South Korea continues debating who should be permitted to issue won-denominated stablecoins, the scope of participation for startups and other non-bank companies is set to become a major issue in designing the system
