Japan: Gold Pegged Cryptocurrency ZPG To Be Issued This Month

While stablecoins are known for their stability, cryptocurrencies are feared for their volatility. Sadly there wasn’t any cryptocurrency that managed to combine them as such and allow the existence of a more stable cryptocurrency. 

Turns out soon there will be one.

The ZipangCoin

In a report from Nikkei Asia today, the news agency reported on the announcement of Japanese trading company Mitsui & Co.’s plans of issuing a gold pegged cryptocurrency in the country. The coin known as ZipangCoin (ZPG) will be available for trading as soon as this month.

Unlike traditional stablecoins, ZipangCoin will not be valued at 1 JPY or 1 USD. The value of ZipangCoin is set to similar to the value of one gram of gold. This means that 1 ZPG will be equal to approximately 6,280 JPY or 54.64 USD. The value’s correlation’s consistency will be backed by Sumitomo Mitsui Banking.

The purpose behind creating a gold pegged cryptocurrency is to enable the younger crypto investors to better manage their assets as buying gold while is a good hedge against inflation is easier to buy as a digital token.

However, beyond the creation of the token, the company plans on also developing a wallet application for smartphones. Through this app, holders can make purchases at affiliated retail stores using ZPG.

To make sure ZPG is accessible to everyone ASAP, Mitsui has already set up a cryptocurrency exchange with Seven Bank which has been approved by the central government’s Financial Services Agency (FSA).

Japan’s CBDC

While Mitsui is preparing for the launch of their gold pegged stablecoin, Japan is also looking, to begin with, its second phase of experiments with Central Bank Digital Currency (CBDC) with the governor believing that the Bank of Japan might make an official decision on the issuance of CBDCs by 2026.

Recently, a former BOJ official, Hiromi Yamaoka also stated that CBDCs are not a good idea since he feels that applying negative rates to CBDC could damage the economy.

Given Japan’s no ban, no regulation, crypto forward-thinking, Mitsui could make an impact in bringing crypto to traditional investors with the ZPG.