Japanese Banks Getting Ready for Stablecoin Remittances
Major Japanese financial groups have now started dipping their feet into blockchain-based remittances. MUFG, Mizuho Financial Group, and SMBC are leading in this very unexpected initiative. Tests of cross-border stablecoin transfers via SWIFT’s API are being carried out by the three giants under a project named “Project Pax”. This collaboration by the blockchain platforms Progmat and Datachain is well on its way in trying to reshape how international transactions work today.
Project Pax: New Generation of International Settlements
In the first week of September, Datachain announced its plans to use the API framework developed by SWIFT for on-chain settlement. The project’s focus was cross-border settlement around the clock, which would help traditional banking systems in the most efficient and cost-effective way.
According to Datachain, “The cross-border transfer platform of Project Pax will make use of Swift’s already existing API framework for banks to instruct Progmat to settle on blockchain networks and respond to AML/CFT and regulatory compliance challenges, as well as operational setup issues, and also take care of wallet usage difficulties businesses have).
The test period will also target Inter-Blockchain Communication protocols enabling such transfers among chain fragmentation.
Japan’s Banks Move Deeper into Stablecoins
MUFG, Mizuho, and SMBC’s trial also comes amid the rising interest of the Land of the Rising Sun in the stablecoin market. Supported by MUFG, Progmat developed a stablecoin issuance platform that is interoperable with blockchains like Ethereum and Polygon. In addition to this, Datachain’s cross-chain technology should pave the way for seamless transfers across multiple chains.
Datachain’s goal is to bring a platform for enterprises that will facilitate cross-border payments without necessarily understanding the details of the use of stablecoins or blockchain technology.
Project Timeline and Commercialization
Total commercialization of this platform is expected by 2025. While the exact details of the timeline of the project remain secret, the venture depicts Japan’s interest in reshaping international finance using blockchain technologies.
With the addition of stablecoins into the existing banking structure, Japan’s financial sector stands at the leading edge of the blockchain revolution of global finance. This trial is a bold step towards quicker, cheaper, and more secure cross-border money transfers.
