Japan’s Hokkoku Regional Bank has introduced a stablecoin backed by bank deposits. This development has Japanese crypto enthusiasts thinking about the potential pros and cons. In addition, the usefulness of the stablecoin is being questioned. The initiative follows the success of the Tochituka app, launched last year in partnership with the Suzu city government. The app allows citizens to earn and spend Tochipo points at select local stores. Moreover, Hokkoku bank account holders can now use the same app to load up their Tochika stablecoin.
The stablecoin is backed by deposits and can be used to facilitate purchases from participating merchants. Moreover, this move is innovative since Japan is a country where cash still reigns supreme. As such, Hokkoku aims to attract retailers by offering a competitive trading rate of just 0.5% for cashless transactions through the app. In addition, the bank aims to convince paper gift certificate companies to move into the digital realm using point-to-point transactions made through the app.
Hokkoku Bank plans to introduce person-to-person payments in the app by the end of the year. It is also seeking to attract other banks in Ishikawa Prefecture to its initiative and is preparing to expand to other regions in the future. The technology behind this innovative platform is developed by Digital Platformer. Moreover, it is believed to use Hyperledger Iroha, a product of the Japanese company Soramitsu. While stablecoin initiatives are being undertaken by banks around the world, Hokkoku’s focus on retail customers and backing of real bank deposits sets it apart from other companies in the space.
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