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1. What happened to the JPYC yen stablecoin in its first year?
JPYC, the yen-backed stablecoin that is Japan's best known, has reached only about a quarter of the circulation target its issuer set for its first year. CEO Noritaka Okabe acknowledged the shortfall in an interview with NADA NEWS, published on October 27, 2026. As of October 23, roughly 3.2 billion yen, about $20 million, was in circulation, despite a string of corporate partnerships announced over the period.
The figures matter because JPYC was one of the first tests of whether a domestic stablecoin pegged to the yen could gain real use inside Japan's regulated financial system. A year in, the token is trading actively on exchanges but is not being held or spent in the volumes its backers expected.
2. Okabe says growth has not met expectations
Okabe was direct about the result. He said JPYC is not growing and has not gained the traction the company had hoped for. He described trading volume as not bad, but said the amount of the token actually in circulation was not satisfactory.
That distinction between activity and balance is central to the story. A stablecoin can change hands often without a large supply sitting in wallets. Trading volume shows interest from market participants, while circulation shows how many tokens remain outstanding after redemptions. For an issuer, the second number is the one that determines the size of the business.
Okabe's comments also frame the company's own expectations. By saying the token has not met its goals, the chief executive is acknowledging that approval to operate and a growing list of partners do not by themselves create demand. Users and companies need a practical reason to hold the token instead of simply using the yen in a bank account, and that reason has so far not been strong enough to lift balances.
3. How much JPYC is actually in circulation?
Circulation stood at about 3.2 billion yen as of October 23, according to figures cited by the Japanese business daily Nikkei. Cumulative issuance since launch, by contrast, reached 12.1 billion yen. The difference between the two numbers reflects tokens that holders have redeemed and that are therefore no longer outstanding.
Independent on-chain tracking is broadly in line. DeFiLlama, which monitors stablecoin supply across blockchains, shows a figure of about $20.85 million, close to the roughly $20 million that the 3.2 billion yen converts to at current rates.
In other words, for every yen-denominated token ever created, about a quarter remains in circulation. The rest has come back to the issuer to be exchanged for yen. That pattern suggests many of the tokens were created for short-term purposes rather than to be held as a store of value or a settlement balance.
It is also worth noting how the headline figures relate to each other. Cumulative issuance counts every token ever created, so it can only rise. Circulation moves up and down with each issuance and redemption. A wide gap between the two, as seen here, indicates high turnover: tokens come into existence and return to the issuer repeatedly rather than staying with long-term holders.
4. Why did circulation jump in September and then fall back?
Circulation did briefly rise above 4.2 billion yen in September. The spike followed a listing of JPYC on Upbit, a South Korean exchange. The listing pushed the token's market price above 1 yen, which gave traders an incentive to mint new tokens at the issuer's one-for-one rate and sell them on the market for a small profit. This kind of price-gap trade is known as arbitrage.
Okabe estimated that about 35 billion yen of JPYC changed hands in a single day across Upbit and the decentralized exchange Uniswap. That figure is many times larger than the supply in circulation at the time. Once the price gap closed, circulation fell back to roughly 3 billion yen.
The episode shows how a stablecoin's supply can respond to market mechanics instead of genuine demand. The newly minted tokens served traders for a short time and were then redeemed, leaving the underlying base of holders little changed.
A stablecoin is designed to be redeemable at a fixed rate, which is what keeps its market price anchored to the currency it tracks. When the price rises above that rate, as JPYC's did after the Upbit listing, anyone who can create tokens at the fixed rate has a reason to do so. When the price returns to parity, the incentive disappears and the new supply is typically redeemed. That is the pattern the September figures describe.
5. How circulation drives the issuer's income
JPYC is backed by bank deposits and Japanese government bonds, and the issuer earns interest on those reserves. This is the standard revenue model for fiat-backed stablecoins: users hold a token that pays no interest, while the issuer collects the yield on the assets that stand behind it.
The consequence is straightforward. The smaller the circulation, the smaller the reserve pool and the lower the interest income. A token with heavy trading but a thin supply therefore generates little revenue for the company that runs it, which is why the circulation gap carries more weight for JPYC than the trading figures do.
This is also why reserve composition matters. Deposits and government bonds are conservative assets that preserve the one-for-one backing, and they provide a steady yield, but the yield is only as large as the reserve it applies to. For a young issuer, growing circulation is therefore both a measure of adoption and the main route to covering its operating costs.
6. The per-transaction cap behind the slow uptake
Okabe pointed to a regulatory constraint as the main brake on growth. JPYC operates under Japan's framework for Type II funds transfer providers, which limits transactions to 1 million yen. That ceiling has made it difficult for businesses to move meaningful sums in the token, and corporate adoption has slowed as a result.
JPYC eased the restriction in May by setting the limit at 1 million yen per request. Even so, the rules still restrict repeated transactions made in quick succession, so a company that wants to build up a large balance cannot do so in a single step.
Type II providers are a category of funds transfer service in Japan that handles smaller remittances. Operating within it keeps the compliance burden lighter than that of a bank, but it comes with the transaction ceiling that Okabe now says is holding the token back.
The practical effect is easy to picture. A company that wants to use a yen stablecoin for supplier payments, treasury holdings or settlement needs to be able to acquire and move amounts well above what individuals handle. If every purchase or transfer is limited to 1 million yen, and repeated transfers are restricted, the process becomes slow and administratively heavy, which discourages larger participants from committing to the token.
7. Corporate partners face friction
The effect of the cap is visible in the plans of the token's business partners. Asteria, a software company, intends to hold 1 billion yen in JPYC. Because of the limit, it has to accumulate that balance gradually through installments instead of acquiring it at once.
JPYC has signed several partnerships that point toward wider use. In July, the logistics company AZ-COM Maruwa agreed to an alliance to develop payment services for about 2,300 of its business partners. That kind of arrangement is intended to put the token to work in everyday commercial settlements.
Earlier this month, SBJ Bank and LINE NEXT agreed to test a service that would let users top up wallets from bank accounts using JPYC. That project remains in its trial stage and has not yet produced a launch that could add to circulation.
Asteria's case illustrates the gap between intention and execution. The company has a clear plan for a sizable holding, yet the rules turn that plan into a staged process. The same constraint applies to any firm considering JPYC for payments, which helps explain why partnership announcements have not translated into a matching increase in outstanding supply.
8. What comes next for Japan's stablecoin rules
Japan's Financial Services Agency, the country's main financial regulator, is reviewing its stablecoin rules. A roadmap from that review is expected in early 2027. The outcome could bear directly on JPYC, since the transaction ceiling that Okabe criticized comes from the regulatory category under which the token operates.
Okabe has set a target for the second year: he wants circulation to reach the tens of billions of yen, which would be roughly ten times the current level. Reaching it will depend on whether corporate holders can build balances more easily, whether pilot projects such as the SBJ Bank and LINE NEXT trial move into production, and whether the regulatory review changes the limits that now shape how the token can be used.
A tenfold increase would represent a sharp change in the token's trajectory. After a first year in which circulation reached about a quarter of the issuer's target and peaked at just over 4.2 billion yen, the company will need sustained holding by businesses rather than the temporary spikes produced by trading activity. Readers should watch three things in the months ahead: the circulation figure reported by on-chain trackers, the progress of the SBJ Bank and LINE NEXT trial, and the details of the regulator's roadmap when it arrives in early 2027.
For now, JPYC stands as a case study in the gap between regulatory approval and real-world demand. A year after launch, the token exists, trades and has partners, but the supply that would make it a meaningful payment instrument remains small.