Japan to lift ban on foreign-issued stablecoins in 2023

Japan’s Financial Service Agency (FSA) will lift the ban on the local distribution of foreign stablecoins like USD Coin (USDC) in 2023, Nikkei reported on Dec. 26.

According to the report, international remittances may become faster and cheaper if stablecoin usage spreads.

Local exchanges would be allowed to handle foreign stablecoin transactions “under the condition of asset preservation by deposits and upper limit of remittance.” The firms are also expected to adhere to strict anti-money laundering measures.

Media reports said the remittances limit is 1 million yen ($7500) per transaction. The FSA will require the exchanges to collect the personal information of their users, like names, etc. Besides that, the regulator said it would start collecting feedback on the guidelines from Dec. 26.

Following Terra UST’s collapse, Japan was one of the first countries to pass a stablecoin bill to ensure investor protection. The Asian country’s stablecoin law said local stablecoin issuers should be limited to financial institutions like banks, trust companies, and registered money transfer agents.

Crypto exchanges operating in Japan do not list USD-backed stablecoins as of Nov. 30.