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Japanese startup JPYC has launched the first stablecoin pegged to the yen, backed by domestic savings and Japanese government bonds. JPYC Is The First Yen-Backed Stablecoin In The World JPYC announced on Monday the launch of its yen-backed stablecoin, also called “JPYC.” A stablecoin is a cryptocurrency pegged to a fiat currency, and at present, the sector is heavily dominated by tokens tied to the US Dollar, with USDT and USDC alone accounting for the majority of the market. Japan is now also dipping into the space with this new stablecoin. According to JPYC, the token will be backed 1:1 by domestic deposits and Japanese government bonds (JGBs). Users can buy or sell the asset through JPYC EX, the Japanese startup’s official platform. The company is offering zero fee on issuance and redemption for now, instead turning to the interest from the JGBs as a source of income. The token is initially becoming available on Ethereum, Avalanche, and Polygon, with support for additional blockchains planned. According to Reuters, JPY is aiming to issue 10 trillion yen worth of the stablecoin over the next three years. At the current rate, this target is equivalent to about $65.5 billion. USDC, the second-largest fiat-tied token in the sector, has a market cap of about $76.3 billion right now. Thus, if JPYC meets its ambitious target, it could potentially rival the USD-ruled stablecoin market. The JPYC launch isn’t the only stable-related development that has occurred in Japan recently. As reported by Bitcoinist, three Japanese megabanks are planning to issue a yen-backed token by the end of 2025. The banks in question are Mitsubishi UFJ Financial Group (MUFG) Bank, Sumitomo Mitsui Banking Corp., and Mizuho Bank. Together, they serve over 300,000 clients. Institutional interest in cryptocurrencies has been rising in the East Asian country recently as the government is considering a regulatory rule change that would allow banks to hold Bitcoin and other digital assets for investment purposes, and register themselves as “crypto exchange operators,” becoming able to offer trading services to customers. While Japan has been moving in a crypto-positive direction, China has remained cautious, offering impediments to stablecoin plans in Hong Kong, according to Financial Times. The Chinese city launched its stablecoin legislation earlier in the year and received enquiries from multiple tech giants for an issuer license. Mainland regulators, however, have urged the companies to halt their plans, raising concerns about the growth of currencies controlled by the private sector. Globally, digital assets pegged to fiat currencies have continued to enjoy capital inflows recently despite Bitcoin and altcoins facing volatility. As the chart shared by institutional DeFi solutions provider Sentora shows, the sector has seen its market cap break a record of $308 billion. Bitcoin Price At the time of writing, Bitcoin is trading around $115,200, up nearly 4% over the last week.

Japan has officially stepped into the regulated stablecoin era with the launch of JPYC EX, the country’s first fully licensed digital yen under the revised Payment Services Act. This milestone marks a pivotal moment for Japan’s financial sector, bridging traditional banking infrastructure with the Web3 ecosystem. Building on earlier versions of JPYC, the new JPYC EX is designed to serve as a compliant, yen-backed stablecoin connecting the nation’s banking system to blockchain-based commerce, DeFi applications, and cross-border payments. With full legal authorization and asset backing, it positions the yen as a future cornerstone in global digital finance. According to CryptoQuant, the total stablecoin market capitalization has now surpassed $150 billion, forming the backbone of liquidity for crypto markets, DeFi protocols, and global payments. Analysts from Citi and Bloomberg project that this figure could expand to between $1.6 and $4 trillion by 2030. Within that rapid growth, JPYC is forecasted to capture roughly 2% of the market, reaching a valuation of around $70 billion. A Fully Regulated Digital Yen Bridging Japan’s Finance and Web3 What distinguishes JPYC EX from other stablecoins is its combination of regulatory clarity, asset backing, and technical versatility. Domestic bank deposits and Japanese government bonds fully collateralize each token, ensuring complete transparency and stability. This structure makes JPYC EX one of the world’s most legally robust stablecoins. A benchmark for compliance-driven innovation in digital finance. Built on Ethereum, Polygon, and Avalanche, JPYC EX provides instant yen transfers with near-zero fees. Making it a practical tool for businesses and individuals alike. It supports commerce, payroll, peer-to-peer payments, and DeFi applications, offering the efficiency of blockchain without sacrificing legal or operational safeguards. JPYC EX also aligns closely with Japan’s digital transformation strategy, which aims to merge traditional finance with emerging Web3 systems. By serving as a settlement layer for e-commerce platforms, NFT marketplaces, and cross-border transactions, the stablecoin enables instant yen transfers across Asia, lowering costs and increasing accessibility for international trade. Looking ahead, analysts forecast JPYC’s market capitalization could reach $70 billion by 2030. It represents roughly 2% of the global stablecoin market. This growth potential underscores Japan’s ambition to establish the digital yen as a key pillar of the decentralized global economy. With its blend of regulatory trust, technological precision, and global reach, JPYC EX may redefine how national currencies operate in the Web3 era. Stablecoin Dominance Shows a Cooling Phase After Recent Surge The chart shows that stablecoin market dominance currently sits around 8.31%, following a sharp rise earlier in October that pushed the ratio above 9%. This level often signals heightened demand for liquidity and safety, as traders move capital into stable assets amid market uncertainty. Over the past few months, dominance has steadily climbed from the 7.3%–7.5% range, reflecting a cautious sentiment as Bitcoin and major altcoins face selling pressure. However, the recent pullback suggests that some funds are beginning to rotate back into risk assets, a potential early sign of market stabilization. Technically, the dominance remains above both the 50-day and 200-day moving averages, indicating a broader uptrend in liquidity positioning. If this level holds, it may serve as a buffer during continued volatility. Conversely, a sustained drop below 8% could signal that traders are redeploying capital into crypto assets, possibly fueling short-term rallies. Stablecoin dominance remains elevated — a sign that market participants still prefer holding dry powder. Until dominance begins a more decisive decline, this cautious stance will likely persist, underscoring the market’s fragile balance between risk-off sentiment and the readiness for re-entry into volatile assets. Featured image from ChatGPT, chart from TradingView.com

On-chain liquidity distribution protocol Turtle has raised $5.5 million in new capital, bringing its total funding to $11.7 million. The project will use the fresh funding to expand its engineering team, develop its DeFi yield-earning product infrastructure, and deepen its integrations across multiple blockchain ecosystems, according to a press release shared with The Defiant.The funding round saw participation from institutional investors including GSR, FalconX, Anchorage VC, as well as founders from Polygon, 1inch, and Gnosis.Turtle describes itself as an infrastructure hub that moves liquidity across decentralized finance, connecting capital providers and protocols through a "coordination layer” that matches liquidity with earning opportunities, while tracking wallet and vault activity on-chain.To continue reading this as well as other DeFi and Web3 news, visit us at thedefiant.io