Japan’s Largest Bank Completes Experiment with Stable Currency for Digital Securities Settlement

According to reports, Japan’s largest bank, Mitsubishi UFJ Financial Group (MUFG), has completed a cross industry experiment using stable currency to settle digital securities. The bank has spent several years developing the digital securities infrastructure Progmat, a key requirement being the ability to settle through stable currency. Therefore, MUFG has developed Progmat Coin as an infrastructure to support stable currencies from multiple regulated issuers.

MUFG completes the interoperability settlement test of Progmat Coin stable currency blockchain

In a recent development, Mitsubishi UFJ Financial Group (MUFG), Japan’s largest bank, has successfully completed a cross-industry experiment that uses stable currency to settle digital securities. The bank has spent several years developing Progmat, a digital securities infrastructure which is a key requirement for settling digital securities through stable currencies. As a result, MUFG has developed a new infrastructure called Progmat Coin, which will support stable currencies from multiple regulated issuers.

Introduction

Mitsubishi UFJ Financial Group (MUFG) is a multinational financial institution that has been at the forefront of digital innovation in the banking sector. Recently the bank has developed a digital securities infrastructure called Progmat that allows for the issuance and settlement of digital securities. In its latest project, MUFG has completed a cross-industry experiment using stable currency to settle digital securities. This development is a significant milestone for the bank and the banking industry as it emphasizes the importance of stable currency in cross-border settlements.

The Importance of Stable Currency in Digital Securities Settlement

The major challenge faced by traditional settlement systems is their inability to increase the speed of transactions while maintaining security and trust. This lack of efficiency results in long settlement periods and high transaction costs. However, with the introduction of digital securities, the potential for faster, more secure, and cost-effective settlement processes has emerged. Digital securities can also be customized to meet the specific needs of investors and issuers.
One of the major barriers to the adoption of digital securities is the high levels of volatility associated with cryptocurrencies. This volatility makes the settlement of digital securities a risky venture, as the value of the underlying asset could fluctuate widely before the transaction is completed. This is where stable currency comes in as a viable solution. Stable currencies are digital currencies designed to maintain a consistent value and can be pegged to fiat currencies or other stable assets.

MUFG’s Progmat Coin

In response to the challenges posed by digital securities and the need for stable currencies in settlements, MUFG has developed Progmat Coin. Progmat Coin is a digital currency infrastructure that supports the settlement of digital securities using stable currencies from multiple regulated issuers. By using stable currency, the potential for volatility is significantly reduced, making the settlement of digital securities more reliable and cost-effective. More so, Progmat Coin ensures interoperability with other digital currencies.

Benefits of Stable Currency in Settlement of Digital Securities

The settlement of digital securities using stable currencies has numerous benefits, some of which are outlined below:

Reduces Transaction Costs

By eliminating intermediaries and the associated transaction fees, the settlement of digital securities using stable currency reduces overall transaction costs.

Faster Settlement

Stable currency allows for near-instant settlement of digital securities, as opposed to traditional settlement that can take days or even weeks.

Increased Trust and Transparency

Stable currency enables the transparent and secure transfer of digital securities between parties without the need for intermediaries. The immutability of transactions on the blockchain also ensures trust between parties.

Access to a Wider User Base

The use of stable currency in the settlement of digital securities eliminates the barriers to entry for investors and issuers. This, in turn, increases the likelihood of participation and investment in digital securities.

Conclusion

The use of stable currency in the settlement of digital securities is a game-changer in the banking industry. MUFG’s development of Progmat Coin takes us closer to the reality of faster, more secure, and cost-effective settlement processes in the issuance and trade of digital securities. The potential for access to a wider user base, reduced transaction costs, near-instant settlement, and increased trust and transparency makes stable currency a necessity for the growth and adoption of digital securities.

FAQs

Q: What is Progmat Coin?

A: Progmat Coin is a digital currency infrastructure developed by Mitsubishi UFJ Financial Group (MUFG), designed to support the settlement of digital securities using stable currencies from multiple regulated issuers.

Q: What is stable currency?

A: Stable currency is a digital currency designed to maintain a consistent value and can be pegged to fiat currencies or other stable assets.

Q: What are the benefits of using stable currency in digital securities settlement?

A: The benefits of using stable currency include reduced transaction costs, faster settlement, increased trust and transparency, and access to a wider user base.