Tokyo Meets Boston: SBI Forges Partnership with Circle for USDC Expansion

by Tareq Sikder
  • Japan's regulatory revision paves the way for stablecoin issuance, fostering the transition to a Web3 economy.
  • SBI Shinsei Bank will provide banking services to Circle as part of their collaboration.
Japan flag against the skyline of Tokyo
Bloomberg
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SBI Holdings, Inc. located in Tokyo has officially entered into a Memorandum of Understanding (MOU) with Circle Internet Financial, which has headquarters in Boston, Massachusetts. This collaboration aims to facilitate the circulation of USDC stablecoins, establish a banking relationship, and promote the use of Circle's Web3 Services within Japan.

SBI Group Adopts Circle's Web3 Services

The Japanese government, recognizing the significance of the digital asset economy, revised the Payment Services Act on June 3, 2023. This revision has established regulations for stablecoins, anticipating a boost in the issuance and circulation of stablecoins in Japan, consequently advancing the country's transition towards a Web3 economy.

Under the Revised Payment Services Act, "collateralized" stablecoins are recognized, and Circle's USDC has distinguished itself by being fully backed by highly liquid cash and cash-equivalent assets. Notably, USDC has maintained a 1-to-1 peg with US dollars and is redeemable accordingly. The USDC reserves are held separately from Circle's operational funds in financial institutions.

Jeremy Allaire
Jeremy Allaire, CEO and Co-Founder, Circle, Source: LinkedIn

The MOU signifies that SBI Group and Circle collaborate on promoting the circulation of USDC and expanding the usage of stablecoins in Japan. Both entities have pledged to adhere to stablecoin-related regulations, ensuring communication with relevant authorities. SBI VC Trade is actively seeking registration as an electronic payment instruments service to facilitate the circulation of USDC within Japan, subject to approval by authorities.

In addition to the collaboration on stablecoin circulation, SBI Shinsei Bank, Limited will extend banking services to Circle. This partnership aims to provide Japan-based businesses and users with access to USDC and enhanced liquidity. As part of SBI Group's digital asset portfolio strategy, Circle's Web3 Services solutions, including the Programmable Wallet, blockchain infrastructure, and smart contract management tools, will be adopted.

Jeremy Allaire, the CEO and Co-Founder of Circle, expressed enthusiasm about the partnership with SBI Holdings, emphasizing the shared vision for the future of digital currency. Yoshitaka Kitao, the Representative Director, Chairman, President, and CEO of SBI Holdings, echoed this sentiment, highlighting the alliance's role in setting new standards in the Japanese financial sector. Kitao underscored SBI Group's commitment to exploring new financial possibilities through the extensive adoption of stablecoins.

SBI's Move into Crypto with TaoTao Purchase

Finance Magnates reported that SBI Holdings has expanded its presence in the digital currency space through the acquisition of the local crypto exchange TaoTao. SBI Liquidity Market, the group's foreign exchange and derivatives arm, has acquired a 100 percent stake in TaoTao. The terms and financial details of the deal were not disclosed. TaoTao, licensed by the Financial Services Agency, launched its digital exchange operations in 2019, providing trading services for several top digital currencies.

This acquisition, the second licensed cryptocurrency exchange for SBI, alongside SBI VCTRADE, is expected to strengthen SBI's position in the crypto market and enhance its existing business. The move comes after TaoTao's reported failed partnership with Binance. SBI's retail Forex platform is additionally offering contracts for difference (CFD) instruments with Bitcoin, Ripple, and Ethereum, and the group invested $30 million in crypto liquidity provider B2C2.

SBI Holdings, Inc. located in Tokyo has officially entered into a Memorandum of Understanding (MOU) with Circle Internet Financial, which has headquarters in Boston, Massachusetts. This collaboration aims to facilitate the circulation of USDC stablecoins, establish a banking relationship, and promote the use of Circle's Web3 Services within Japan.

SBI Group Adopts Circle's Web3 Services

The Japanese government, recognizing the significance of the digital asset economy, revised the Payment Services Act on June 3, 2023. This revision has established regulations for stablecoins, anticipating a boost in the issuance and circulation of stablecoins in Japan, consequently advancing the country's transition towards a Web3 economy.

Under the Revised Payment Services Act, "collateralized" stablecoins are recognized, and Circle's USDC has distinguished itself by being fully backed by highly liquid cash and cash-equivalent assets. Notably, USDC has maintained a 1-to-1 peg with US dollars and is redeemable accordingly. The USDC reserves are held separately from Circle's operational funds in financial institutions.

Jeremy Allaire
Jeremy Allaire, CEO and Co-Founder, Circle, Source: LinkedIn

The MOU signifies that SBI Group and Circle collaborate on promoting the circulation of USDC and expanding the usage of stablecoins in Japan. Both entities have pledged to adhere to stablecoin-related regulations, ensuring communication with relevant authorities. SBI VC Trade is actively seeking registration as an electronic payment instruments service to facilitate the circulation of USDC within Japan, subject to approval by authorities.

In addition to the collaboration on stablecoin circulation, SBI Shinsei Bank, Limited will extend banking services to Circle. This partnership aims to provide Japan-based businesses and users with access to USDC and enhanced liquidity. As part of SBI Group's digital asset portfolio strategy, Circle's Web3 Services solutions, including the Programmable Wallet, blockchain infrastructure, and smart contract management tools, will be adopted.

Jeremy Allaire, the CEO and Co-Founder of Circle, expressed enthusiasm about the partnership with SBI Holdings, emphasizing the shared vision for the future of digital currency. Yoshitaka Kitao, the Representative Director, Chairman, President, and CEO of SBI Holdings, echoed this sentiment, highlighting the alliance's role in setting new standards in the Japanese financial sector. Kitao underscored SBI Group's commitment to exploring new financial possibilities through the extensive adoption of stablecoins.

SBI's Move into Crypto with TaoTao Purchase

Finance Magnates reported that SBI Holdings has expanded its presence in the digital currency space through the acquisition of the local crypto exchange TaoTao. SBI Liquidity Market, the group's foreign exchange and derivatives arm, has acquired a 100 percent stake in TaoTao. The terms and financial details of the deal were not disclosed. TaoTao, licensed by the Financial Services Agency, launched its digital exchange operations in 2019, providing trading services for several top digital currencies.

This acquisition, the second licensed cryptocurrency exchange for SBI, alongside SBI VCTRADE, is expected to strengthen SBI's position in the crypto market and enhance its existing business. The move comes after TaoTao's reported failed partnership with Binance. SBI's retail Forex platform is additionally offering contracts for difference (CFD) instruments with Bitcoin, Ripple, and Ethereum, and the group invested $30 million in crypto liquidity provider B2C2.

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