Japan’s Financial Services Agency (FSA) is set to approve the issuance of the nation’s first yen-denominated stablecoin, JPYC, as early as this autumn, according to a report by Nikkei.

The initiative is led by Tokyo-based fintech firm JPYC Inc., which plans to issue up to 1 trillion yen ($6.81 billion) of the stablecoin within three years. The company is expected to complete its registration as a licensed money transfer business within the month.

Unlike traditional cryptocurrencies, stablecoins are designed to maintain a 1:1 peg to fiat currencies, and JPYC will be fully backed by liquid assets, including yen deposits and Japanese government bonds. This aligns with Japan’s updated legal framework, which since June 2023 has classified stablecoins as “currency-denominated assets.”

Once launched, JPYC will be available to individuals, businesses, and institutional investors, who can purchase the tokens via bank transfers and store them in electronic wallets. Use cases will include international remittances, corporate payments, and applications in decentralized finance (DeFi). The token is already attracting attention from hedge funds and family offices for carry trades, a strategy that seeks profit from interest rate differentials.

JPYC enters a global stablecoin market currently dominated by dollar-pegged tokens like USDT (Tether) and USDC (Circle). With the market already exceeding $250 billion, and Citigroup projecting it could grow to $3.7 trillion by 2030, Japan’s move signals an ambitious push to establish the yen in the future of digital finance.

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