Japan-based Mizuho, MUFG, and SMBC announced that they had completed a joint pilot of a yen-denominated stablecoin for cross-border payments. The test ran from 17 to 23 July 2026 and used a single token issued jointly by the three banks. The group is targeting real transactions in fiscal 2026, which runs from April 2026 to March 2027.
Pilot structure and legal framework
The project brought together the three megabanks and two partners, with responsibilities divided across issuance, custody, and technology. Mitsubishi UFJ Trust and Banking acted as trustee, holding the underlying assets on behalf of beneficiaries in line with the terms of the trust. TISI Inc. served as the technology provider. In addition, SMBC supplied the blockchain platform used in the pilot, which TISI built.
The tokens were issued under Japan’s Payment Services Act, with the three banks acting as joint settlors, meaning they established the trust and placed the backing assets into it. Bank deposits backed the tokens. Circulation was restricted to users at participating banks who had completed KYC verification, although no cap was placed on the volume in circulation. The design therefore kept the token within the verified customer base of the issuing institutions.
Cross-border settlement as the main use case
The pilot centred on cross-border settlement between Mitsubishi Corporation’s headquarters in Japan and its overseas offices. Participants tested the full token lifecycle: issuance, transfer between parties, and redemption of tokens for cash.
According to the banks, the results confirmed the safety, reliability, and operational viability of multi-bank joint issuance. Participants also gained practical insight into the systems and operational processes involved. Compliance work during the test covered anti-money laundering (AML) and counter-terrorist financing (CFT) measures, areas that any move to live use would need to address.
Regulatory backing and next steps
According to the announcement, the initiative has the support of Japan’s Financial Services Agency (FSA), which selected the project in November 2025 under its FinTech PoC Hub and Payment Innovation Project. In June 2026, the banks announced the formation of a joint council to study governance and operational questions linked to the token.
No live transactions have been carried out so far, and moving to real-world use remains the project’s next milestone. The pilot’s outcome nonetheless gives banks exploring digital money a working template for a model in which several institutions jointly issue a single deposit-backed token, operating within an existing legal framework and with supervisory involvement from the outset. Whether that template translates into commercial use will depend on the transactions planned for the remainder of fiscal 2026.
