Japan's LDP Panel Calls for Yen Stablecoins in Asia, Crypto ETF Framework

Japan's ruling Liberal Democratic Party (LDP) panel on June 1 proposed that the government promote yen-based stablecoins for settlement across Asia and create a legal framework for cryptocurrency exchange-traded funds (ETFs). The blockchain promotion panel submitted the proposal to Finance Minister Satsuki Katayama, who also oversees the Financial Services Agency. "Crypto-ETFs would provide investors with easy-to-understand ways of investment," the proposal stated, urging the government to designate the product as an official financial market investment. Panel member Junichi Kanda said Japan should advance yen stablecoins and blockchain innovation when it hosts the Asian Development Bank's annual meeting in May 2027. The move comes as Japan's three largest banks, backed by the FSA, jointly experiment with issuing stablecoins, and startup JPYC began issuing yen-pegged tokens in October 2025. Meanwhile, U.S.-backed dollar stablecoins have surged under President Donald Trump, prompting warnings from policymakers about risks to regulated banking systems. Bank of Japan Deputy Governor Ryozo Himino last month advocated a "holistic approach" to future monetary systems beyond central bank digital currencies and stablecoins.