Japan’s ruling Liberal Democratic Party has advanced a new AI-blockchain finance proposal that calls for tokenized deposits, yen stablecoins, and 24/7 programmable settlement.
Summary
- Japan’s LDP approved an AI-blockchain finance plan linking tokenized deposits, stablecoins, and agentic commerce systems.
- Proposal calls for tokenized Bank of Japan deposits and yen stablecoins to support programmable payments.
- Asian policy framework would align RWA audits, KYC rules, and cross-border on-chain finance standards regionally.
The proposal, titled “Next-generation AI & Onchain Finance Concept,” was prepared by an LDP project team under Seiji Kihara. Kihara said on X that the proposal had passed the party process and reached a final decision.
The document was issued on May 19 by the LDP’s Policy Research Council and Digital Society Promotion Headquarters. It frames AI and blockchain as tools for a future economy where payments, contracts, lending, and delivery can run around the clock.
Kihara said, “It is truly a ‘concept,’ and from here on, we will build it up piece by piece.” He added that follow-up work will decide how the plan moves from policy language into practical steps.
Tokenized deposits and yen stablecoins take center stage
The proposal says Japan should promote tokenized deposits that can use smart contracts to connect payments with trade and logistics. It asks deposit-taking financial institutions to develop tokenized deposit products and reach a clear view on key issues within the year.
It also calls for clearer legal treatment of stablecoins. The document says Japan should clarify whether stablecoins can be used for wages, tax payments, and company capital contributions, with cross-ministry work expected within the fiscal year.
The proposal also supports tokenizing Bank of Japan current account deposits, including possible wholesale CBDC use. It asks the central bank to publish its review path for implementation by year-end.
Yen stablecoin policy links to megabank projects
The LDP plan also refers to Japan’s Payment Innovation Project, where three megabanks are studying joint stablecoin issuance. The proposal says the work should target real use by next March, including overseas cash management for large companies.
Related reports have shown the same direction in Japan’s market. crypto.news previously reported that MUFG, SMBC, and Mizuho are working on yen-backed stablecoin settlement networks, while Japan’s FSA has been setting stricter reserve rules for stablecoin issuers.
Separate crypto.news coverage also noted that Bank of Japan Governor Kazuo Ueda has backed blockchain settlement research, including tokenized central bank money and sandbox work linked to current account deposits.
Asia on-chain finance framework enters proposal
The LDP document also calls for an “AI and Onchain Finance Asia Policy Dialogue Framework.” The proposed framework would bring public and private groups together to discuss RWA definitions, audits, KYC, AML, and cross-border rules.
The proposal says Japan should work toward an Asian on-chain finance platform. It says 40% to 50% of Japan’s trade settlement with Asian countries is already yen-denominated, giving Japan a base for wider regional payment cooperation.
