This article comes fromDecrypt, original author: Andrew Asmakov

Odaily Translator | Nian Yin Si Tang

, original author: Andrew Asmakovto reportOdaily Translator | Nian Yin Si Tang

According to Bloomberg Fridayto report, the Japanese Senate just passed a landmark law clarifying the legal status of stablecoins, essentially defining them as digital currencies. With this, Japan has become one of the first major economies to introduce a legal framework around stablecoins.

The Act was initially prepared by the Japan Financial Services Agency (FSA) and will be issued in December 2021.
first announced

, and was passed by Parliament in March this year, followed by majority approval in the Senate plenary session on Friday.

Under the new legislation, stablecoins must be pegged to the Japanese yen or other fiat currency and guarantee holders the right to redeem them at face value.

This legal definition actually means that stablecoins can only be issued by licensed banks, registered transfer agencies and trust companies, focusing on investor protection. The bill does not address stablecoins or algorithmic stablecoins issued by overseas issuers such as Tether. It is reported that there are no stablecoins listed on Japanese encryption exchanges.

The new legal framework will come into force within a year. Japan’s Financial Services Agency said it will roll out regulations governing stablecoin issuers in the coming months.“We see Japan’s landmark law as a standard-setting example of sensible policy,” Dante Disparte, chief strategy officer for global policy at Circle, the USDC issuer, told Decrypt. Provide guidance. This is exactly the kind of leadership and balanced approach to stablecoin legislation we want to see from other countries.”In February this year, Mitsubishi UFJ Trust Bank announced that

Launch of stablecoin platform Progmat Coin

, for the issuance and management of stablecoins pegged 1:1 to the Japanese Yen. The platform aims to realize a "universal digital asset payment method", providing cross-chain interoperability with various other digital assets in addition to digital assets issued on Progmat and the Bank of Japan's digital currency digital yen.

Stablecoins gain regulatory attentionpointed outStablecoins have come under increased scrutiny in recent weeks with the debacle of Terra's algorithmic stablecoin UST and the LUNA token. UST was once the largest decentralized stablecoin in the crypto industry, but recently experienced a rapid de-anchor and eventual collapse, causing billions of dollars in losses to investors.

The Terra debacle has also sent shockwaves through global cryptocurrency markets and fueled regulatory concerns, as U.S. Treasury Secretary Janet Yellen has said.

, UST is an example of "rapidly growing risk".expressBut she then clarified that cryptocurrencies in general do not pose any systemic risk to the financial system.

U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce is another top regulator joining the debate around stablecoin regulation.

expressWould like to see clear regulatory rules around the use of cryptocurrencies and stablecoins.Peirce also said the events surrounding Terra last month "may encourage" Congress to get involved and "get to work faster."