Nomura and GMO Internet Team Up to Explore Issuing Dollar and Yen Stablecoins in Japan

Today Nomura announced a collaboration involving its digital assets subsidiary Laser Digital and GMO Internet, the parent of GMO-Z, which issues New York-regulated stablecoins.

Japanese financial services giant Nomura Holdings has announced a new digital assets initiative today, in collaboration with GMO Internet, the parent of New York-regulated stablecoin issuer GMO-Z.

The two companies will work together to explore the issuance of dollar and yen stablecoins in Japan, as well as the provision of a stablecoin-as-a-service solution within the Japanese market.

GMO-Z is licensed by the New York State Department of Financial Services (NYDFS) as a limited purpose trust company, the same charter held by Paxos and Gemini Trust, two of the largest stablecoin issuers in the United States.

Its GYEN and ZUSD stablecoins are available on the Ethereum, Solana and Stellar blockchains. They are also used in decentralized finance applications, such as Aave and Curve.

“This project has the potential to greatly enhance digital asset accessibility and innovation in the Japanese financial landscape,” said Kentaro Okuda, President and Group CEO, Nomura Holdings.

“We are excited to work with GMO Internet to bring new possibilities to the Japanese financial industry and contribute to the creation of a more advanced and efficient financial system.”

Tokenization has progressed a little faster in Japan than elsewhere, although it is also early days. For example, Japan has a secondary market for tokenized securities, ODX START, and there have been a reasonable number of institutional issuances of tokenized real estate.

Without a wholesale central bank digital currency (wholesale CBDC), stablecoins can enable the settlement of on-chain financial transactions.

Stablecoin competition in JapanSince Japan's new stablecoin laws came into force last year, a wide array of stablecoin initiatives have been announced by various organizations.

Apart from GMO, the other existing Japanese stablecoin issuer is JPYC, which is starting to form alliances with other stablecoin initiatives.

That includes Progmat Coin, the issuance platform initiated by MUFG and backed by other major banks, including SMBC, Mizuho and Sumitomo Mitsui Trust.

Japanese law supports three kinds of stablecoins. One is issued via a Trust company, which is the type supported by Progmat Coin and MUFG. Another is issued by a bank and is effectively a deposit token. A third is issued by the holder of a funds transfer (money services) license, which we believe JPYC has applied for.

While JPYC is a startup, GMO Internet is a listed company. Together with GMO Financial it owns half of online bank GMO Aozora Net Bank.

The bank will be the first to launch a use case under DCJPY the tokenized deposit solution founded by DeCurret. DCJPY evolved from the Digital Currency Forum, which involves more than 100 Japanese institutions and enterprises, including Nomura.