Japan's top yen stablecoin falls short of its target in a disappointing first year

JPYC, Japan's leading yen stablecoin, has underperformed expectations in its initial year, achieving only about a quarter of its circulation goal.

As of Oct. 23, circulation stood at 3.2 billion yen, compared to a total issuance of 12.1 billion yen, according to Nikkei. CEO Noritaka Okabe stated in an interview with NADA NEWS, "Frankly, I don’t think it’s growing."

Okabe attributed the slow corporate adoption to a 1 million yen per-transaction cap imposed by Type II funds transfer providers.

Despite these weak figures, JPYC has secured partnerships with AZ-COM Maruwa, SBJ Bank, and LINE NEXT. Okabe has set a target of tenfold growth for the second year.

Circulation briefly reached 4.2 billion yen in September following a listing on South Korean exchange Upbit, which briefly pushed the market price above 1 yen.

Okabe estimated that roughly 35 billion yen exchanged hands across Upbit and Uniswap in one day before circulation dropped back near 3 billion yen.

The stablecoin's business model relies on interest earned from bank deposits and Japanese government bonds backing its reserves; thus, lower circulation reduces potential interest income.

The 1 million yen daily issuance limit tied to Japan's Type II funds-transfer rules has hindered corporate uptake. Software company Asteria, planning to hold 1 billion yen in JPYC, must now build its balance through installments.

The weak performance contrasts with recent developments, including AZ-COM Maruwa's July alliance for about 2,300 business partners, and agreements with SBJ Bank and LINE NEXT this month to test wallet top-ups.