USDC Becomes First Dollar-Pegged Stablecoin Approved in Japan

Stablecoin issuer Circle has gotten approval to offer USDC in Japan, CEO Jeremy Allaire said on Tuesday.

The stablecoin has now become "the first and only global dollar stablecoin to become approved for use in Japan," Allaire wrote on X (formerly Twitter).

He also offered congratulations to crypto exchange SBI, which right now is the only firm approved to list and distribute USDC to Japanese investors.

According to a post from SBI, the company plans to enable USDC trading for a "limited number of users" on March 12, with a full-scale offering coming "as soon as possible" thereafter.

As of this writing, USDC has a $56 billion market capitalization. And because the stablecoin is meant to maintain its 1:1 peg with U.S. dollars, its market cap rises and falls relative to how many tokens are in wallets.

In June 2022, Japan passed a stablecoin bill that recognized the tokens as a form of digital money. The legislation, which went into effect in 2023, requires stablecoins to be linked to the yen or another legal tender and guarantee holders the right to redeem them at face value.

It also specified that approved stablecoins could only be issued by licensed banks, registered money transfer agents, and trust companies, with the FSA reporting that regulations governing stablecoin issuers are to be introduced in the coming months.

"We see Japan’s landmark law as a standard-setting example of smart policy," Dante Disparte, chief strategy officer and head of global policy at USDC-issuer Circle, told Decrypt in 2022 when the legislation first got approved. "This is exactly the kind of leadership and balanced approach to stablecoin legislation we hope to see from other countries.”

The Japan USDC announcement comes just a few weeks after Coinbase CEO Brian Armstrong said he considers catching up to USDC's rival, Tether, as one of the company's "stretch goals." Coinbase and Circle co-founded the Centre Consortium in 2018 to oversee issuance of USDC. But Coinbase got more hands-on with the stablecoin in 2023, when it acquired a minority stake in Circle and dissolved the Centre Consortium.

But USDC has a lot of ground to cover before it can check that off its to-do list. At the time of writing, Tether boasts a $142 billion market cap, making it very comfortably the third-largest crypto asset, according to CoinGecko data.

USDT was recently dealt a blow after Binance announced that it will delist the stablecoin for EU customers at the end of the month.

Edited by Andrew Hayward