World’s Fifth Largest Bank MUFG to Put Stablecoin to Practical Use in 2019

Japanese bank holding and financial services company Mitsubishi UFJ Financial Group (MUFG), the fifth largest bank in the world, is set to put its digital currency MUFG Coin into practical use later this year. The news was reported by Cointelegraph Japan on April 9.

News of the planned rollout was revealed by the newly-appointed MUFG president Kanetsugu Mike in an interview with local media agency Asahi Shimbun, Cointelegraph Japan reports.

MUFG is the largest financial company in Japan and is prospectively set to become the first Japanese bank to issue a virtual currency, specifically a blockchain-based stablecoin pegged 1:1 to the Japanese yen.

The asset is designed with a focus on currency functionality, with customers to download an app that will automatically convert their bank deposits into the stablecoin.

According to Cointelegraph Japan, approximately 1,500 company employees have participated in trialing MUFG Coin since 2017.

"I would like to offer unprecedented new value," Kanetsugu Mike reportedly told Asahi Shimbun.

As Cointelegraph has reported in May 2018, MUFG revealed its intention to test MUFG Coin with as many as 100,000 account holders in 2019.

While the phasing between this envisaged testing period and practical implementation this year was not clarified by the president, the bank reportedly intends that users “will be able to use the currency to make payments at places like restaurants, convenience stores and other shops,” as well as to “transfer the currency to other participants’ accounts.”

In late December 2018, fellow Japanese banking giant Mizuho Financial Group announced its own plans to launch a bespoke digital currency for payments and remittance services.

Originally slated for a launch date of March 1, Mizuho’s still-to-be-released “J-Coin” stablecoin platform will reportedly directly link existing bank accounts with digital wallets. The initiative is planned together with 60 counterpart financial institutions, which together reportedly host 56 million user accounts.

Japan is notably already served by digital payment innovators such as e-commerce giant Rakuten, which will soon launch its own crypto exchange, and chat app provider Line, which has itself launched its own cryptocurrency and in-house blockchain.