A stablecoin is a crypto asset designed to hold a one-to-one value with a fiat currency such as the US dollar or the Japanese yen (under Japanese law, an "electronic payment instrument"). On overseas exchanges, dollar-denominated coins such as Tether (USDT) and USD Coin are the base currency for trading. In Japan, yen stablecoins have launched in succession: JPYC (funds-transfer type) in October 2025 and JPYSC (trust type) in June 2026.
This column explains how JPYC and JPYSC work and differ, the Japanese government bond (JGB) backing announced for JPYSC on 7 September 2026, and how yen stablecoins relate to the USDT used on overseas exchanges, within what can be confirmed from the issuers' official announcements. It is not a recommendation to buy or hold any particular stablecoin.
What is a yen stablecoin? Its position under Japanese law
The amended Payment Services Act that took effect in June 2023 defines fiat-pegged stablecoins as "electronic payment instruments" and limits issuers to banks, funds-transfer service providers and trust companies (trust banks). Legally they are a different category from crypto assets such as Bitcoin.
| Category | Definition | Yen stablecoin type |
|---|---|---|
| No. 1 electronic payment instrument | Fiat-denominated value issued by a bank or a funds-transfer service provider, usable for transfers and redeemable | Funds-transfer type (JPYC); transfer amount limits depend on the provider's licence category |
| No. 2 electronic payment instrument | Value exchangeable with No. 1 instruments with unspecified parties (intended mainly for overseas-issued stablecoins) | — |
| No. 3 electronic payment instrument | Specified trust beneficiary rights issued by a specified trust company (trust company or trust bank) | Trust type (JPYSC); user funds are segregated as trust assets and there is no statutory cap on issuance or redemption |
※ Category numbers follow Article 2 of the Payment Services Act; bank-issued coins also fall under No. 1. Handling overseas-issued dollar stablecoins in Japan requires registration as an electronic payment instrument service provider.
JPYC vs JPYSC: issuer, limits and where they can be used
As of 11 September 2026, the main yen stablecoins actually issued and circulating are JPYC and JPYSC. The differences confirmed on the issuers' official websites are as follows.
| Item | JPYC | JPYSC |
|---|---|---|
| Issuer | JPYC Inc. (funds-transfer service provider) | SBI Shinsei Trust Bank (trust type) |
| Legal type | No. 1 electronic payment instrument (funds-transfer type) | No. 3 electronic payment instrument (trust type) |
| Launch | 27 October 2025 | 24 June 2026 (sold through SBI VC Trade) |
| Chains | Ethereum, Polygon and other public chains | Ethereum (ERC-20); currently only inside SBI VC Trade accounts, external deposits and withdrawals not yet supported |
| Issuance/redemption limit | JPY 1,000,000 or less per transaction (funds-transfer licence cap) | No statutory cap |
| Fees | No issuance or redemption fee (official site) | No spread, trading fee or deposit/withdrawal fee (SBI VC Trade) |
| Price | Issued and redeemed at 1 JPYC = JPY 1 | Fixed at 1 JPYSC = JPY 1 inside SBI VC Trade |
※ JPYC is issued and redeemed on "JPYC EX" after identity verification. JPYSC is bought and sold inside SBI VC Trade accounts, and a lending service started in July 2026. Conditions may change; confirm on each official site.
JPYC can be sent to any wallet on public chains, so it is intended for Web3 services and payments. JPYSC can currently be used only inside SBI VC Trade accounts and cannot be sent to external wallets. Whether the coin can move freely on-chain is the biggest difference between the two today.
What is the JPYSC JGB backing? JPY 1 billion moved into short-term JGBs on 7 September 2026
On 7 September 2026 SBI Shinsei Trust Bank and SBI VC Trade announced that JPY 1 billion of the assets backing JPYSC is now managed in short-term Japanese government bonds with three months or less to maturity. At the time of the announcement, JPYSC outstanding was about JPY 20.1 billion, and applications for JPYSC Lending stood at about JPY 6.9 billion.
The background is the amended Payment Services Act and related regulations that took effect on 1 June 2026. They allow trust-type stablecoin backing assets to be held not only in demand deposits but also, up to 50% of the amount issued, in government bonds with three months or less remaining and in time deposits. The JPY 1 billion is about 5% of outstanding issuance: the amount issued does not fall; part of the funds supporting the coin's value moved from deposits to bonds.
Interest earned on the JGB backing is revenue for the issuer and is not paid to JPYSC holders as interest or dividends. Holding a stablecoin does not by itself earn a yield; the same applies to dollar coins such as USDT.
Yen stablecoins vs USDT on overseas exchanges: deposits and tax points
Spot and futures markets on overseas exchanges are quoted in dollar stablecoins such as USDT. The launch of yen stablecoins does not change the unit of trading on overseas exchanges to yen. For overseas exchange users, the relationship comes down to the following.
- Most overseas exchanges do not accept direct yen deposits. The usual route is yen → crypto asset (or USDT) → overseas exchange. Whether an exchange accepts a yen stablecoin as a deposit differs by exchange; check the supported assets and networks on each exchange's deposit screen
- If you send a yen stablecoin to an overseas exchange, a wrong network or address cannot be reversed; sending an unsupported asset means losing it
- USDT is dollar-denominated, so its yen value moves with the exchange rate. A yen stablecoin keeps a fixed yen value, but it is not yet common as a trading pair on overseas exchanges
- Stablecoins also have a tax treatment as electronic payment instruments or crypto assets; exchanging them for crypto assets or converting to yen can be a taxable event. Keep records and consult the tax office or a tax accountant when unsure
- Before using one on an overseas exchange, confirm the deposit assets and networks the exchange supports (do not send anything unsupported)
- Check the issuer, backing assets and redemption terms of the stablecoin on its official site (avoid coins whose issuer cannot be identified)
- Test with a small transfer, wait for it to be credited and withdraw it before increasing the amount
Deposits, transfers and choosing the right network (beginner guide) →
Frequently asked questions
Q. What is a yen stablecoin?
A. A digital currency designed to hold a one-to-one value with the Japanese yen, defined as an electronic payment instrument under Japan's Payment Services Act. Only banks, funds-transfer service providers and trust companies (trust banks) can issue them. As of September 2026, JPYC (funds-transfer type) and JPYSC (trust type) are issued and circulating.
Q. What is the difference between JPYC and JPYSC?
A. JPYC, issued by JPYC Inc. as a funds-transfer type, can be sent to any wallet on public chains such as Ethereum, but issuance and redemption are capped at JPY 1,000,000 per transaction. JPYSC, issued by SBI Shinsei Trust Bank as a trust type, has no cap but as of September 2026 can be used only inside SBI VC Trade accounts, with external transfers not yet supported.
Q. What is the JPYSC JGB backing?
A. On 7 September 2026 SBI Shinsei Trust Bank and SBI VC Trade announced that JPY 1 billion of JPYSC backing assets is now managed in short-term Japanese government bonds with three months or less to maturity. This follows the amended Payment Services Act effective 1 June 2026, which allows up to 50% of the amount issued to be held in short-term JGBs and time deposits. The income is not paid to holders.
Q. Can I deposit yen stablecoins on an overseas exchange?
A. It depends on the exchange. The base currency on overseas exchanges is dollar stablecoins such as USDT, and whether a yen stablecoin is accepted must be checked on each exchange's deposit screen, including the supported assets and networks. Sending an unsupported asset means losing it.
Q. Do stablecoins earn interest just by holding them?
A. No. Income from the JGB backing of JPYSC goes to the issuer and is not paid to holders. If you use a separate lending service, check that service's rate, terms and the risks of the issuer and provider individually.
Sources
FX Textbook is an independent information site, not an exchange or a provider of personal investment advice. Crypto-asset trading involves risk: price volatility, liquidation of leveraged positions, transfer mistakes and the operational risk of exchanges and service providers can cause you to lose some or all of your invested capital. No result is guaranteed.
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