Payment services company Circle (CRYPTO: USDC) is contemplating the issuance of a stablecoin in Japan, following the recent implementation of legislation governing stablecoins in the country.

The firm's co-founder and CEO, Jeremy Allaire, told CoinDesk that Japan could become a significant market if stablecoins are increasingly utilized for global commerce, foreign currency transactions, and cross-border trade.

Also Read: Celsius Network and Former CEO Face Potential Legal Action By US Regulators

He praised Japan's stablecoin bill, which positions the country as one of the first to establish a framework for the use of overseas stablecoins, referring to it as the most crucial action taken by the government and the Financial Services Agency.

Circle is also interested in forming partnerships in Japan, a country Allaire visited the previous month.

The revised Payment Services Act in Japan certifies stablecoins backed by legal tender as an "electronic payment method" and permits their issuance.

However, the issuers of stablecoins will have to comply with stringent rules. Stablecoins must be pegged to the yen or other legal tender and guarantee holders the right to redeem them at face value.

Only licensed financial institutions like registered money transfer agents, licensed banks, and trust companies will have the authority to issue stablecoins.

The Financial Services Agency in the country decided to lift a ban on overseas stablecoins in December of the previous year.

Recently, Circle secured a Major Payment Institution (MPI) license in Singapore, enabling it to offer digital payment token services, domestic money transfer services, and cross-border money transfer services in the city-state.
Major Japanese financial institutions have been exploring stablecoins, with Mitsubishi UFJ Trust and Banking Corporation announcing its plans to issue its own stablecoin platform, known as Progmat.

Read Next: Binance CEO Changpeng Zhao Predicts Massive Trading Surge On The Horizon

Join Benzinga's Future of Crypto in NYC on Nov. 14, 2023 to stay updated on trends like AI, regulations, SEC actions & institutional adoption in the crypto space. Secure early bird discounted tickets now!

Image: Pixabay