MUFG Bank Set to Launch Its Own Coin
Mitsubishi UFJ Financial Group Inc. (MUFG), Japan’s largest bank, plans to launch its own coin in March 2018. MUFG bank will also be introducing its own cryptocurrency exchange. Its coin, which is now being referred to as the MUFG coin, will be pinned to the Japanese Yen (JPY). This could have its advantages and disadvantages. For example, since the coin will be pegged to the JPY, it will have to abide by Japanese banking laws. This means that money transfers equivalent to or exceeding 1 million JPY will have to be approved by a bank.
A More Stable Coin
If the coin had not been pegged to the JPY, technically any amount could have been transferred via the blockchain. However, the coin would also be more volatile, according to officials from MUFG bank. Pegging it to the country’s JPY should give the coin more stability. By also offering its own crypt0-exchange, the bank intends to create a “more stable” coin, because it will be worth roughly around 1 JPY at any given time.
Cheaper Transactions with MUFG Coin
Initially, MUFG bank will make the coin available to members of the financial services group. The goal is to offer more cost effective transactions , compared to credit cards, for everyday expenses. For instance, paying for meals at a restaurant or simply transferring money to your friend’s account should be cheaper with MUFG coin.
In order to use the coin for transactions, you will have to create a wallet, just like you need to with most other cryptocurrencies. The bank plans to internally manage and monitor all transactions. This coin seems to have a lot of proper planning behind it, considering it was first put through a test on Coinbase’s GDAX crypto-exchange.
Japanese Regulators Have Been Informed
MUFG bank has kept Japanese regulatory authorities in the loop by informing them of its plans ahead of time. The bank also seems like it is trying to help regulators by offering a crypto safety net. Scheduled to be launched around April of this year, the safety net will be offered to crypto-exchanges for a set price. It will be designed to oversee all transactions that occur on any particular crypto-exchange. Although this might do away with the anonymous nature of crypto-transactions, potentially fraudulent transactions could be detected and suspended before they can cause any harm.
Japan Loves Crypto
Most crypto-enthusiasts are aware that cryptocurrencies are very popular in Japan. Japanese banks seem to be quite keen to investigate crypto-technology, particularly blockchain, in order to possibly adopt it for their own use. Core Media reported a few weeks ago how 61 major Japanese banks had decided to engage in a pilot program with two of South Korea’s largest banks in order to test out the payment process with Ripple’s XRP. This might have influenced Ripple’s market capitalization to temporarily become the second largest in the crypto-market, surpassing that of Ethereum’s.
Japan’s economy is among the world’s biggest. If Japan manages to capitalize even more on the world’s crypto-market, then this would only translate into more economic success for a country that prizes itself on hard work and discipline.