SBI Holdings is filing for registration as an electronic payment services provider in Japan. The move is part of the memo of understanding between SBI and Circle. Circle is responsible for issuing USDC stablecoin and now working in tandem with SBI Holdings based out of Tokyo.
The firm will boost the adoption of Web 3.0 services in Japan. The agreement contains details regarding the expansion of USDC in the land of the rising sun.
The government of Japan recently revised the Payment Services Act in June to create regulatory requirements for stablecoins. As per Circle, the new regulatory framework will boost the issuance and distribution of stablecoins among Japanese investors.
The stablecoin issuer further noted the stablecoin regulations will also assist in transition of Japanese economy towards the Web 3.0 sector. SBI Holdings is therefore applying for registering as electronic payment services provider to enable USDC circulation. These services are subject to approval from Japanese regulatory administrators.
The Impact of Stablecoin Regulations
Yoshitaka Kitao, the president SBI Holdings recently noted that the new stablecoin regulations are a step forward for stablecoin adoption within the country. He noted that Japan is laying down groundwork for large-scale adoption of stablecoins.
He noted that the company is very excited to enter into a basic agreement and form business alliance with USDC coin issuer. On the other hand, Circle CEO, Jeremey Allaire noted that the collaboration signifies scope of future development for digital currencies.
He noted that Circle will work alongside SBI Holdings to promote the full-stable web 3.0 service suite. At the same time, it will ensure end-to-end development, deployment, and operations. In this manner, the venture will work on creating and operating Web3 applications within the blockchain sector.
The executive noted that the project will work on adding Think games, consumer entertainment, and culture aspects. At the same time, he retained that the firm is excited about working alongside SBI Holdings and setup new operating processes in the TradeFi and DeFi sector of Japan.
SBI Subsidiary to Work with Circle for USDC Access and Liquidity
SBI Shinsei Bank is a subsidiary of the Circle platform that is offering banking services for Circle to bring USDC access and liquidity for retail and commercial investors. Circle is based in United States, around 70% of USDC investors hail from overseas territories.
Allaire shared in August that at present, investors hailing from Asian regions represent the largest bracket of USDC stablecoins. The executive further noted that digital dollar demand in regions such as Latin America and Africa has remained high.
Circle is currently working on permission-less transfers and moved the cross-chain transfer protocol (CCTP) to Noble. In this manner, USDC stablecoin will be natively minted on Cosmos inter-blockchain communication protocol.
The move is part of the plan to add more utility to USDC project and stop the ongoing value stagnation. Noble bridge connects Arbitrum, Base, Ethereum, Optimism, and Avalanche networks through CCTP.
In this manner, the protocol allows investors to move USDC to various Cosmos applications such as Osmosis and dydX. As per MintScan, the protocol has already moved $20 million in USDC. CCTP employs a burn-and-mint method to create new USDC coins on various blockchain networks.