Japan’s three largest banking groups are reportedly planning to jointly launch a stablecoin as institutional interest in blockchain-based digital money grows. According to a Friday report from the Nikkei, Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group and Mizuho Financial Group will create a shared framework for issuing and transferring stablecoins among their corporate clients. The tokens will be pegged to real-world currencies, starting with the Japanese yen, with a dollar-denominated version potentially to follow. The stablecoins will be built on a system that allows interoperability between banks under common technical and legal standards,, the report said. While details on the infrastructure remained limited, the initiative marks a coordinated effort to digitize interbank settlements in a way that mirrors existing fiat rails. Notably, MUFG founded a blockchain infrastructure and tokenization platform Progmat in 2023, backed by a wide consortium of Japanese institutions. The move comes as stablecoin adoption is rapidly spreading globally, with nation's putting regulations in place. U.S. dollar-pegged tokens dominate the market, with Tether's USDT and Circle's USDC taking up the bulk of the $300 billion sector. A group of nine European banks, including heavyweights ING and UniCredit, reportedly plan to issue a euro stablecoin to counter the dominance of U.S. dollar-backed tokens. Major U.S. banks are also mulling issue a stablecoin jointly. In August, fintech firm JPYC was reportedly obtained license as a money transfer operator with the Financial Services Agency (FSA), a necessary step for offering its Japanese yen-backed token legally. Japanese financial giant SBI Holdings also announced plans to distribute Ripple’s U.S. dollar-pegged stablecoin (RLUSD) in Japan as early as the first quarter of 2026, pending regulatory clearance.