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SBI Holdings and Circle Forge Groundbreaking Partnership to Pave the Way for Digital Currency Innovation in Japan

SBI Holdings, Inc., a prominent financial conglomerate based in Tokyo, has inked a Memorandum of Understanding (MOU) with Circle Internet Financial, the issuer of USDC, the world’s largest regulated stablecoin. The collaboration aims to facilitate the circulation of USDC stablecoins, establish a banking relationship, and promote the utilization of Circle’s Web3 Services within Japan.

This groundbreaking move follows the Japanese government’s recent revision of the Payment Services Act in June 2023, specifically introducing regulations for stablecoins. The regulatory framework is poised to galvanize the issuance and circulation of stablecoins in Japan, propelling the nation further toward a Web3 economy.

Under the Revised Payment Services Act, “collateralized” stablecoins backed by legal tender find validation. However, Circle’s USDC takes a distinctive stance by being fully backed—100%—by highly liquid cash and cash-equivalent assets, always maintainable at a 1:1 ratio with U.S. dollars. The reserves backing USDC remain segregated from Circle’s operational funds, held in leading financial institutions, ensuring USDC holder benefits. Notably, as of November 17, 2023, on-chain USDC transactions have surpassed a staggering $12.7 trillion.

The signed MOU delineates the collaborative endeavors ahead, with SBI Group and Circle initially concentrating efforts on USDC circulation and expanding stablecoin usage across Japan. Both entities are committed to rigorous compliance with stablecoin-related regulations, pledging transparent communication with regulatory bodies. SBI VC Trade Co., Ltd. is actively pursuing registration as an electronic payment instruments service to facilitate USDC circulation, subject to regulatory approval.

SBI Shinsei Bank, Limited, under this strategic alliance, will extend banking services to Circle, facilitating USDC access and liquidity for businesses and users in Japan. Additionally, as part of SBI Group’s digital asset portfolio strategy, the adoption of Circle’s Web3 Services, including Programmable Wallet, blockchain infrastructure, and smart contract management tools, is on the horizon.

Jeremy Allaire, CEO and co-founder of Circle, emphasized, “Our partnership with SBI Holdings represents a shared vision for the future of digital currency, and is a significant milestone in Circle’s expansion plans in Japan and Asia Pacific.” Allaire expressed enthusiasm about collaborating with SBI, foreseeing the establishment of new benchmarks in Japan’s financial sector.

Yoshitaka Kitao, Representative Director, Chairman, President & CEO of SBI Holdings, echoed this sentiment, stating, “Japan is steadily preparing the groundwork for the full-scale introduction of stablecoins.” Kitao highlighted the substantial market capitalization and global utility of USDC, affirming SBI Group’s commitment to exploring new financial prospects through stablecoins.

The alliance between SBI Holdings and Circle heralds a transformative era for Japan’s financial landscape, poised to unlock novel opportunities in digital currency innovation, fostered by a pioneering collaboration aiming to revolutionize the use of stablecoins in the country.

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