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Japan’s Largest Bank is Starting a Revolution

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January 27, 2018 | 

Joanna Newman |  0 Comments| 

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It is now with certainty that we can say Japan’s biggest banking institution, the Mitsubishi UFJ Financial Group, is launching their own digital currency exchange. This will likely consist of several Bitcoin accounts with the addition of their own joint cryptocurrency. This will mostly target private investors, as well as those who use other stock exchanges.

Apparently, the MUFG has already contacted the country’s Financial Services Agency (JFSA) on their decision to enter the world of digital currency trading.

Most major financial companies in Japan already offer some form of virtual currency trading, which helps them maintain their own shares of the market. It was only a matter of time before the MUFG stepped into the ring.

The Launch of Yen Compatible Tokens

According to one of the country’s most well-known newspapers, Mainichi Shimbun, the MUFG plans to launch a cryptocurrency that will be able to cover its value, based on the price of the Japanese Yen. Essentially, MUFG is planning to exploit a Yen reserve and to produce an equivalent number of virtual tokens, corresponding to the price of the country’s currency.

This is meant to offer more security to traders and investors, given that other digital currencies are still quite volatile on the global markets. The idea is to propose a new cryptocurrency that will be maintained near the value of 1 Japanese Yen.

With this, traders could easily transfer their assets into Japanese Yen during periods of extreme volatility during global market fluctuations. Aside from this, its users will be able to preserve their existing assets with this new token as an alternative.

Something Like the American Idea

When you take a deeper look, the new digital currency is quite like the USD and a cryptocurrency known as Tether, which is maintained at or near the value of the US dollar.

And now, due to a lack of third-party verifications, the USDT has caused some hiccups in the MUFG’s plans to use a Yen-based digital currency.

As a result, the company will be audited by another firm to help ensure the support of the MUFG’s new tokens by the country’s currency.

This, combined with the fact that the company has only made this information available to Japanese media, is causing some level of uncertainty for the moment.

What This Will Offer

Currently, the MUFG only plans to operate on the Japanese markets, which means that their token would only be used for local Japanese transactions. However, they have made mentions of crypto-traders around the world being able to access it, once it is released. The firm also plans to adopt the use of trade pairs on “non-fiat” exchanges, instead of using the US dollar.

This is like the strategy used by Forex traders. To gain a little bit more security, they use separate accounts to be able to back up their client’s funds. This is one of the best possible precautions to take, offering safety to traders in case the platform is ever hacked or goes bankrupt.

At the same time, the MUFG will also be able to monitor all accounts to be able to quickly identify any unusual transactions or suspicious activity and be able to take the appropriate actions.

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