Circle and Nomura Partner for Instant Yen-Dollar FX Settlement in Japan

Stablecoin issuer Circle and Japan's largest investment bank Nomura have reportedly partnered to enable instant foreign exchange settlement for Japanese companies as early as 2027.

The service would enable companies to convert yen into dollar-denominated stablecoins for cross-border transactions and instant settlement, reducing delays caused by banking hours and time zone differences, Nikkei reported on Thursday.

The partnership would bring one of the world's largest dollar stablecoins into Japan's corporate foreign exchange market, expanding the use of stablecoins for business-to-business cross-border settlement.

Circle is the issuer of the world’s second-largest stablecoin, USDC (USDC), which has a market capitalization of $73.8 billion, CoinMarketCap data shows.

Cointelegraph has reached out to Circle and Nomura but had not received a response by press time.

Stablecoin initiatives in Japan have been accelerating as financial institutions explore regulated blockchain-based settlement. On Wednesday, SBI Holdings and Startale Group announced JPYSC, a trust bank-backed yen stablecoin designed for institutional and cross-border settlement, while Ripple USD (RLUSD), the world's 10th-largest dollar stablecoin by market capitalization, officially launched in Japan.

Japan has been one of the first major economies to establish a legal framework for stablecoins, allowing banks, trust companies and licensed money transfer providers to issue regulated tokens under the Payment Services Act.

The Payment Services Act also currently governs cryptocurrencies in Japan, but regulators have been moving to shift digital assets under the Financial Instruments and Exchange Act, which would bring them closer to the regulatory treatment of traditional financial products.

Earlier in June, Japan’s Lower House passed a bill that would bring crypto assets under the country's financial instruments framework, potentially opening a path to exchange-traded funds, lower tax treatment, tighter exchange oversight, disclosure requirements and insider trading restrictions.

The proposed changes would also lower the capital gains tax on crypto assets from the current 55% to a 20% flat rate.