Japan’s JPYC Stablecoin Circulation Reaches Just $20 Million in First Year, Missing Target
Japan's yen-backed JPYC stablecoin has struggled to build sustained circulation during its first year, reaching approximately 3.2 billion yen, or around $20 million, despite attracting corporate partnerships and gaining a listing on South Korean cryptocurrency exchange Upbit.
JPYC CEO Noritaka Okabe acknowledged the shortfall in an interview with NADA NEWS, saying he was dissatisfied with the token's circulation despite describing its trading volume as “not bad.” “Frankly, I don’t think it’s growing,” he said.
Data reported by Nikkei showed 3.2 billion yen worth of JPYC in circulation as of October 23, compared with cumulative issuance of 12.1 billion yen. The circulation figure was close to the approximately $20.85 million reported by DeFiLlama. The gap indicates that some issued tokens have subsequently been redeemed rather than remaining in circulation.
JPYC Circulation Spiked After Upbit Listing
JPYC briefly exceeded 4.2 billion yen in circulation in September following its listing on Upbit. The listing pushed the token's market price above its intended one-yen level and prompted traders to mint new tokens to pursue arbitrage opportunities.
Okabe estimated that approximately 35 billion yen changed hands across Upbit and Uniswap in a single day. However, circulation subsequently retreated to around 3 billion yen, highlighting the difference between short-term trading activity and sustained demand for the stablecoin.
The distinction is important to JPYC's business model. The token is backed by bank deposits and Japanese government bonds, with the issuer earning interest on the assets held as reserves. A smaller circulating supply means a smaller pool of reserves that can potentially generate interest income.
Issuance Restrictions Complicate Corporate Adoption
Okabe attributed part of JPYC's disappointing performance to issuance restrictions associated with Japan's Type II funds-transfer rules. The framework had imposed a daily issuance limit of 1 million yen, restricting how quickly users could obtain larger amounts of the stablecoin.
JPYC eased its restrictions in May, allowing issuance of up to 1 million yen per request instead of per day. However, rapid repeat transactions remain restricted, limiting the ability to build large balances quickly.
The constraints have affected corporate customers as well. Software company Asteria, which plans to hold 1 billion yen in JPYC, has had to accumulate its holdings in installments rather than acquiring the full amount at once.
Corporate Partnerships Expand Despite Weak Circulation
JPYC has continued to secure partnerships as it seeks to expand the stablecoin's use in business payments. Logistics company AZ-COM Maruwa signed an alliance in July to develop payment services for approximately 2,300 business partners.
SBJ Bank and LINE NEXT also agreed earlier in October to test bank-linked stablecoin wallet top-ups. The initiative remains in the trial stage, so its potential contribution to broader adoption has yet to be established.
Japan's Financial Services Agency is also reviewing stablecoin regulations, with a regulatory roadmap expected in early 2027. The review could be relevant to the environment in which yen-backed stablecoins operate, although the source material does not specify what changes regulators may propose.
JPYC Targets Tens of Billions of Yen in Its Second Year
Despite the slow start, Okabe wants JPYC's circulation to reach tens of billions of yen in its second year. Achieving that goal would require roughly a tenfold increase from its current circulation level.
The company's next challenge is to convert trading interest and corporate partnerships into balances that remain in circulation. Its ability to overcome issuance constraints and develop practical payment use cases will be important to its stated growth ambitions.
source: coindesk
Writer: Ethan Collins
Crypto Journalist
Ethan Collins reports on developments across the cryptocurrency and blockchain sector. His work covers market movements, protocol updates, regulatory changes, and emerging trends in digital assets.
He focuses on presenting complex topics in a clear and accessible manner for a broad readership.
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