Japan’s financial watchdog, the Financial Services Agency (FSA), has officially endorsed a major stablecoin pilot project involving the country’s three largest financial institutions—Mizuho Bank, MUFG, and SMBC—as part of a concerted effort to drive payment innovation using blockchain technology.
The FSA announced on Friday that the coordinated experiment, which also includes partners like Mitsubishi Corporation and Progmat Inc., will test the joint issuance of stablecoins classified as “electronic payment instruments” under Japanese law. This initiative, which began in November 2025, aims to verify the legal and operational compliance for a system where multiple banking groups can seamlessly issue digital currency tokens, setting a crucial precedent for institutional adoption of stablecoins in a highly regulated environment.
The pilot is the inaugural project under the FSA’s newly launched Payment Innovation Project (PIP), a specialized initiative designed to accelerate blockchain-based payment solutions within the agency’s existing FinTech Proof-of-Concept Hub. The move is viewed as a significant step in modernizing Japan’s financial infrastructure, promising faster and more efficient digital transactions across major corporate and institutional networks.
The FSA has committed to publishing the results and legal insights from the experiment on its website, paving the way for broader integration of regulated digital assets into the mainstream economy.
