The Japan Blockchain Foundation has received official regulatory approval to launch a new trust-based yen stablecoin, EJPY. With this development, the number of stablecoin projects in Japan launched in the past six months has risen to four. Previous initiatives like JPYC and JPYSC were already in development, while the nation’s top three banks—Mitsubishi UFJ, Sumitomo Mitsui, and Mizuho—announced in October last year that they intend to jointly issue their own stablecoins by the end of 2025. These major banks already provide a wide range of financial services for hundreds of thousands of corporate clients both domestically and internationally.
EJPY’s structure and advantages
EJPY is defined as a “Type III electronic payment instrument” under Japanese regulation. This trust-based model introduces high levels of flexibility and security for stablecoin operations. By law, Type I electronic payment instruments impose a 1 million yen (about $6,700) cap per transaction. However, the trust model used for EJPY is not subject to such restrictions, giving EJPY a clear edge for large-scale corporate payments, major transfers, and digital asset exchanges.
EJPY is initially slated to launch on the Japan Open Chain (JOC), a layer-1 blockchain compatible with Ethereum and operated by 14 institutional validators from Japanese companies. The Foundation aims to bring EJPY into circulation on JOC by the end of fiscal year 2026, which concludes in March 2027. Ethereum compatibility will also be available from day one. Foundation representatives say they expect transaction volume for the token to be driven by real-world demand.
EJPY has been designed to serve diverse needs, from commercial payments to digital asset transfers. The Foundation is targeting transaction volumes rooted in actual market use.
Security mechanism and banks’ involvement
Within EJPY’s trust-based framework, the Foundation acts as the main project backer. Customer funds are managed independently by licensed trust companies, fully segregating user assets from those of the issuing body. The Foundation is currently in talks with several potential trust company partners regarding issuance, redemption, asset management, and compliance. However, the precise launch date and distribution partners depend on regulatory approval being finalized.
SBI Holdings and Startale Group are following a similar legal pathway. Their JPYSC stablecoin will be issued by SBI’s subsidiary Shinsei Trust & Banking, with release planned for the second quarter of 2026.
Market and previous stablecoin initiatives
JPYC made its market debut in October 2025 as Japan’s first licensed yen stablecoin. Operating with a Type II fund transfer model, JPYC faces stricter transactional constraints. Since launch, JPYC has issued tokens worth over 1 billion yen (about $6.3 million) and aims to reach a cumulative volume of 1 trillion yen (approximately $6.6 billion) within three years.
Japan’s three largest banks have also been developing their collaborative stablecoin project since 2025. In addition to the yen, a dollar-pegged stablecoin has been tested within the same framework, with the first trial conducted in March 2026 on the Progmat infrastructure. This banking consortium’s “Payment Innovation Project” is said to enjoy official support and special recognition from Japan’s Financial Services Agency.
Foundation CEO Hiroaki Inaba explained that Japan Open Chain was created to offer a secure blockchain platform specifically for Japanese businesses. EJPY is anticipated to set a new standard for commercial transactions, fund transfers, and Web3 services. These recent movements underscore the rapid diversification of the stablecoin ecosystem in Japan.
