SBI Holdings, Inc has concluded a Memorandum of Understanding (MOU) with Circle Internet Financial, the issuer of USDC, to circulate USDC stablecoins, establish a banking relationship and promote the use of Circle’s Web3 Services in Japan.

Japan’s Revised Payment Services Act establishes “collateralized” stablecoins that are backed by legal tender. Circle’s USDC goes a step further because they are backed 100% by highly liquid cash and cash-equivalent assets and are always redeemable 1 to 1 for U.S. dollars. USDC reserves are held separately from Circle’s operating funds at leading financial institutions for the benefit of USDC holders.

The companies have signed an MOU underpinning the work ahead, which includes SBI Group and Circle initially working towards the circulation of USDC and expanding the use of stablecoins in Japan. SBI Group and Circle have also committed to properly complying with stablecoin-related regulations, including communication with authorities.

To circulate USDC stablecoins within Japan, SBI VC Trade Co., Ltd. is seeking registration as an electronic payment instruments service, which is subject to approval by the authorities.

SBI Shinsei Bank, Limited will also provide banking services to Circle. This will enable USDC access and liquidity for Japan-based businesses and users. Moreover, as part of SBI Group’s digital asset portfolio strategy, SBI Group’s will also adopt Circle’s Web3 Services solutions such as Programmable Wallet, blockchain infrastructure and smart contract management tools.

“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,” said Jeremy Allaire, CEO and co-founder of Circle. “We are excited to collaborate with SBI towards setting new standards in the financial sector in Japan.”

“Japan is steadily preparing the groundwork for the full-scale introduction of stablecoins, such as through the revised Payment Services Act implemented in June 2023. Under such circumstances, we are very pleased to have signed a basic agreement for a comprehensive business alliance with Circle, which manages and issues USDC, a stablecoin with a market capitalization of nearly 4 trillion yen and used globally in more than 190 countries, and to have taken the first step toward widespread adoption of stablecoins in Japan. SBI Group is committed to wholeheartedly working towards realizing new financial possibilities using stablecoins,” said Yoshitaka Kitao, Representative Director, Chairman, President & CEO of SBI Holdings.