MUFG Completes Cross-Industry Experiment Using Stable Currencies to Settle Digital Securities

According to reports, Japan’s largest bank, Mitsubishi UFJ Financial Group (MUFG), has completed a cross industry experiment using stable currency to settle digital securities. The bank has spent several years developing the digital securities infrastructure Progmat, a key requirement being the ability to settle through stable currency. Therefore, MUFG has developed Progmat Coin as an infrastructure to support stable currencies from multiple regulated issuers.

MUFG completes the interoperability settlement test of Progmat Coin stable currency blockchain

An outline of the article is as follows:
I. Introduction
II. Background on Mitsubishi UFJ Financial Group (MUFG)
III. The Journey towards Developing Progmat
IV. Progmat Coin: An Infrastructure to Support Stable Currencies
V. Cross-Industry Experiment Successfully Completed
VI. The Benefits of Using Stable Currencies to Settle Digital Securities
VII. The Future of Digital Securities Settlement
VIII. Conclusion
IX. FAQs
**I. Introduction**
Mitsubishi UFJ Financial Group (MUFG), Japan’s largest bank, has revealed the successful completion of a cross-industry experiment using stable currencies to settle digital securities. This ground-breaking development is expected to revolutionize the way digital securities are settled and pave the way for more efficient and secure transactions in the future.
**II. Background on Mitsubishi UFJ Financial Group (MUFG)**
MUFG is Japan’s largest financial group and has been at the forefront of innovation in the financial industry. The group has been developing digital securities infrastructure known as Progmat over several years with the aim of providing secure and efficient mechanisms for trading digital securities.
**III. The Journey towards Developing Progmat**
Progmat was designed to provide a seamless experience for trading and settling digital securities. The infrastructure was created to provide regulated issuers with the ability to support stable currencies. This was necessary due to the volatility associated with cryptocurrencies, which operates outside the conventional banking system.
**IV. Progmat Coin: An Infrastructure to Support Stable Currencies**
To support stable currencies from multiple regulated issuers, MUFG has developed Progmat Coin. Progmat coin is an infrastructure that enables the issuance and trading of digital securities using stable currencies, a move seen as bold and groundbreaking. Currently, many securities are settled in the conventional financial system utilizing, for example, fiat currencies, a process known for its prolonged settlement cycles. As a result, MUFG aims to use Progmat Coin to revolutionize digital securities trading, making the process seamless and efficient.
**V. Cross-Industry Experiment Successfully Completed**
In September 2021, MUFG completed a cross-industry experiment using stable currencies to settle digital securities on Progmat. The experiment involved Mizuho Financial Group, Sumitomo Mitsui Banking Corporation, and SMBC Nikko Securities. It was aimed at testing the Progmat infrastructure, specifically on whether it can handle large-scale trading of digital securities while leveraging stable currencies to increase the efficiency of the settlement process. The experiment was successful, and all participants agreed to pursue the project further.
**VI. The Benefits of Using Stable Currencies to Settle Digital Securities**
Using stable currencies to settle digital securities has several benefits. Firstly, stable currencies, being pegged to reserve assets, reduce the volatility associated with cryptocurrencies, providing a more stable avenue for trading and settling digital securities. Secondly, using stable currencies to settle digital securities eliminates the need for intermediaries, such as central clearinghouses, thus increasing efficiency and reducing costs. Finally, by using stable currencies to settle digital securities, financial institutions can create opportunities for investors who are hesitant to engage in the traditional cryptocurrency space due to its volatility.
**VII. The Future of Digital Securities Settlement**
The successful completion of this cross-industry experiment is a testament to the potential of Progmat Coin. The infrastructure creates an opportunity for digital securities to be traded and settled within the conventional financial system. With traditional financial institutions like MUFG seeking to expand their operations into digital assets, the future of digital securities settlements appears to be bright. It is expected that more banking and financial institutions will embrace digital securities and stable currency settlements as they provide opportunities in the market in years to come.
**VIII. Conclusion**
MUFG’s completion of the cross-industry experiment using stable currencies to settle digital securities heralds a new era in the world of digital securities trading. The success of this experiment opens the way for regulated banking and financial companies to join the digital space utilizing stable currencies as a settlement option. The move is expected to promote efficiency, transparency, and cost savings in the sector, and create opportunities for investors who have hesitated to engage in cryptocurrencies due to volatility.
**IX. FAQs**
1. What are stable currencies?
Stable currencies are cryptocurrencies that are pegged to traditional reserve assets such as fiat currencies, commodities, or even cryptocurrencies to reduce price volatility.
2. How does Progmat coin work?
Progmat Coin supports stable currencies from multiple regulated issuers to enable the issuance and trading of digital securities. It eliminates the need for intermediaries such as central clearinghouses.
3. How will the use of stable currencies for settling digital securities benefit investors?
The use of stable currencies will create a more stable avenue for trading and settling digital securities, promote efficiency, transparency, and cost savings, and create opportunities for investors who are hesitant to engage in the traditional cryptocurrency space due to volatility.