The largest banks in Japan, MUFG, SMBC, and Mizuho, are embracing blockchain technology to transform international payments. By adopting a stablecoin-based payment system, these banks plan to replace traditional intermediaries with blockchain to streamline cross-border transactions.
Blockchain Meets Traditional Banking
In a bold move, MUFG, SMBC, and Mizuho are working together on Project Pax, a platform designed to simplify cross-border payments. This innovative system will integrate SWIFT, the globally recognized messaging network, while utilizing stablecoins behind the scenes.
The result is a seamless transaction experience for users, without them needing to understand the blockchain technology driving the process.
Advantages of Stablecoins for International Payments
The introduction of stablecoins in cross-border payments offers numerous benefits. Payments will be faster, cheaper, and available 24/7, thanks to blockchain’s efficiency. Stablecoins, with their price stability, ensure that transactions remain predictable and secure, making them ideal for international settlements.
Progmat The Foundation of Project Pax
Project Pax will be built on Progmat, a tokenization network developed by MUFG with the support of Mizuho, SMBC, and other institutions. Progmat will allow for the creation and management of stablecoins, which will power the platform.
Additionally, the network has a partnership with DMM Group to mint licensed stablecoins tied to the Japanese yen.
Testing and Launch Plans for Project Pax
Although the exact launch date is yet to be confirmed, Project Pax is set to begin testing with a working prototype soon. The banks involved in this project aim for a full launch in 2025, expanding their partnerships with both national and international entities to create a robust global payment solution.
Japan’s Growing Adoption of Stablecoins
Japan’s commitment to blockchain technology has been bolstered by the introduction of a stablecoin law in 2022. This law allows licensed Japanese banks to issue their own stablecoins, pegged to the yen or other legal currencies, further supporting the growing acceptance of blockchain-based payments in the country