As bitcoin trading becomes the new mainstream in Japan, leading financial firms are stepping in to offer services to preserve their market share. MUFG, the largest bank in the country, is now planning to launch its own exchange, a pegged cryptocurrency and bitcoin segregated accounts for clients of other exchanges.
Mitsubishi UFJ Financial Group, Inc. (NYSE:MTU), the fourth largest bank in the world, plans to launch its own cryptocurrency exchange this financial year. According to reports from the country, MUFG has already notified the Financial Services Agency (JFSA) on the decision to launch an exchange.
The bank is known to be working on issuing its own cryptocurrency. The plan as it seems now is that by controlling the exchange where people can trade this MUFG Coin, the bank could suppress drastic fluctuations in its price so it can be used for shopping, settlements and remittances stably. The idea is that the new cryptocurrency will be kept pegged at around JP¥1, but not fixed in advanced so as to bypass regulations regarding issuing and transmitting such private money in Japan.
Needles to say, while MUFG only envisions its coin used to make stable transactions in Japan, once the cryptocurrency will be out in the wild global traders can use it for other uses as well. One interesting application is for it to be used in trading pairs on non-fiat exchanges instead of USTD, backed by the largest bank in Japan instead of Tether.
The bank is reportedly working on another service for Japanese cryptocurrency traders, MUFJ Trust – will keep client holdings in accounts which can link to exchanges but without sending the money to their control. Similar to how segregated accounts are used to protect forex traders, this can safeguard client funds at the bank in case the trading company is hacked or goes bankrupt. The service will also monitor accounts for suspicious activity and uncommon transactions, which could get flagged for inspection instead of being processed.
The service, which will be available just for bitcoin at first, is expected to launch in April 2018 or as soon as the JFSA recognizes bitcoin as an asset that can be placed in a trust. This will be the first ever trust arrangement for cryptocurrencies, according to its application for patent protection. Enjoying the protection of MUFJ Trust’s would cost a fee, but “customers will feel peace of mind knowing that a trust bank is managing their assets,” said CEO Noriyuki Hirosue of Tokyo-based exchange Bitbank.
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Post from news.bitcoin.com