Japan's Payment Services Act (PSA) has regulated fiat-backed stablecoins as Electronic Payment Instruments (EPIs) since June 2023, limiting issuance to licensed banks, trust companies, and funds transfer service providers with strict reserve and consumer protection requirements. The May 19 2026 FSA updates allow qualifying foreign-issued trust-type stablecoins to be treated as EPIs effective June 2026. 2025 amendments provide more flexibility in reserve management.
Applicable Laws:
Amendment to Payment Services Act: Stablecoin Legal Framework - https://practiceguides.chambers.com/practice-guides/fintech-2025/japan/trends-and-developments
First domestic yen-pegged stablecoin approvals (JPYC, RLUSD) - https://cointelegraph.com/news/japan-approves-first-yen-stablecoin-jpyc
