Japanese Bank SMBC Collaborates with Ava Labs for Stablecoin Launch
Sumitomo Mitsui Financial Group (SMBC), Japan’s second-largest bank, is developing a stablecoin with Ava Labs and Fireblocks. This initiative reflects increased interest from banks in fiat-pegged stablecoins to capture market share.
- Ava Labs will provide the blockchain foundation for the stablecoin.
- Fireblocks will manage the token system.
- SMBC will collaborate with TIS, a local IT firm, for experiments in the latter half of this year.
- Stablecoins aim to improve cross-border payments by reducing costs and eliminating intermediaries compared to traditional systems.
In 2024, SMBC plans a cross-border stablecoin pilot with Mizuho Financial Group and Mitsubishi UFJ Financial Group.
Japan has maintained a crypto-friendly stance, enacting regulations for stablecoins in 2022 that classify them as “Electronic Payment Instruments.” However, issuance is limited to licensed banks and registered entities.
The US stablecoin market is also evolving, influenced by new policies under the Trump administration emphasizing USD-pegged stablecoins. Circle, issuer of USDC, has filed for an IPO to list on the NYSE.