JPYSC Launches, Heavy Betting on DeFi: Breaking Down SBI’s On-Chain Financial System in Japan

Author: Zen, PANews

The WebX, a major Asian Web3 industry conference, has just wrapped up in Tokyo. In a video address, Japan’s Prime Minister Hayato Takashi Yoshi… expressed the hope that the synergistic effects between the Web3 conference and government policies can further advance the development of Japan’s innovation ecosystem.

The bustling crowd on site stands in stark contrast to the subdued crypto market atmosphere. Many participants even joked that they could feel the “beauty of a crypto bull-up period” right there at the venue.

As part of the conference’s agenda within the continually expanding business footprint of Japanese financial group SBI Holdings, the event also ensured that this crypto-active “old-timer” in the market stole the spotlight on site. SBI not only served as the title sponsor; the group’s chairman Yoshitaka Kitao also took the stage to deliver a keynote speech. Back in October last year, SBI acquired 51% of the shares of CoinPost, the Japanese crypto media organization that organized WebX, and folded it into the group.

And this shift echoes SBI’s recent flurry of moves in the digital asset space. Over the past month or more, SBI Holdings participated in a $175 million funding round for the decentralized lending protocol Morpho, rolled out the yen stablecoin JPYSC, and went live in Japan with Ripple-issued dollar stablecoin RLUSD.

In July, it invested $125 million into DeFi risk management and yield strategy platform Gauntlet, and during the WebX event it also established a strategic partnership with the Solana Foundation, planning to expand its business around stablecoins, RWA, cross-border settlement, and institutional on-chain services.

Compared with its broader past layout around Ripple, exchanges, market making, and digital securities, SBI’s recent strategic focus is more concentrated. This traditional financial group, founded 27 years ago, is trying to reassemble on-chain settlement, asset issuance, trading, credit, and asset management from traditional finance.

From distributed layout to on-chain finance: SBI integrates digital asset businesses

SBI has been in the crypto industry for a decade. In the early years, it invested in Ripple, participated in enterprise blockchain company R3, and gradually built crypto trading, institutional liquidity, and digital securities businesses—making it one of the earliest and most wide-ranging digital-asset players among Japan’s traditional financial groups.

However, in the early stage, the businesses were relatively dispersed. SBI VC Trade handles crypto asset trading and custody; B2C2 provides liquidity for global institutions; the digital securities business explored tokenization of bonds, funds, and other real-world assets. Until the past two years, “on-chain finance” began to emerge as the new framework connecting these businesses.

In its strategic materials released in May 2026, SBI divides on-chain finance into six layers: settlement, assets, markets, yield vaults, distribution, and investors, and proposes building an “SBI on-chain asset management platform.”

Under its plan, JPYSC, USDC, and RLUSD handle settlement and fund transfers; blockchain and RWA platforms take on asset issuance and trading; DeFi improves capital efficiency; and the group’s internal asset management, securities, and digital asset businesses are responsible for product design and customer reach.

From recent investments, SBI appears to be building its layout strictly according to this structure and layering. In its own strategic materials, SBI places Circle’s financial blockchain Arc in the “settlement layer,” Morpho in the “market layer,” and maps Gauntlet to the “yield vault layer.”

This categorization also reveals SBI’s investment logic—making up the foundational capabilities missing from its on-chain finance system.

Stablecoins lead the way, building a yen and dollar settlement network

Within SBI’s on-chain finance framework, stablecoins are the part that entered actual operations first.

On June 24, JPYSC, co-developed by SBI and Startale, officially went live. JPYSC is issued by SBI’s new trust bank, with SBI VC Trade responsible for circulation and Startale handling the main technical development. As Japan’s first yen stablecoin issued using a trust structure, JPYSC is designed according to Japan’s “Type 3 electronic payment means” in the Act on Settlement of Funds. Reserve assets are managed by the trust bank, and 1 JPYSC corresponds to 1 yen.

One important difference brought by the trust structure is that JPYSC is not subject to the remittance and holding limits that stablecoins of the “partial funds transfer” type and “overseas issuance” type face. In theory, this makes it more suitable for corporate fund transfers, large-value settlement, RWA trading, and cross-border payments.

However, JPYSC still has some distance to go before open on-chain circulation. At the moment, the product is only provided within SBI VC Trade accounts; users cannot transfer JPYSC to or withdraw it to external wallets. SBI said that once relevant legal interpretations, tax practices, and operational arrangements are further clarified, it will move toward public on-chain circulation.

While external transfers are not yet open, SBI has already started expanding the usage scenarios of JPYSC within its platforms. SBI VC Trade announced that it would open applications for JPYSC lending services on July 16 and officially launch them on July 23. Users can lend their held JPYSC to the platform and receive yield paid in JPYSC after the term ends; the annualized yield rate for the first batch is 3%, with the expected regular annualized range remaining around 1% to 3%.

Beyond the yen stablecoin, the dollar stablecoin provides another connection capability.

In March 2025, SBI VC Trade became the first platform in Japan to offer USDC trading services to regular users. Since then, SBI’s partnership with Circle has extended from stablecoins to the capital and business layers.

In March 2025, both parties signed an agreement to establish a joint venture, Circle SBI Japan, with SBI and Circle each holding 50% of the shares. Its main responsibility is to drive USDC’s circulation in Japan and expand payment and other financial applications. In June of the same year, when Circle listed on the New York Stock Exchange, SBI acquired $50 million worth of Circle shares as a strategic investor.

In March 2026, SBI VC Trade also launched USDC lending services, extending stablecoin applications from trading and payments to yield products.

In addition to USDC, SBI VC Trade further rolled out RLUSD in June this year. RLUSD is issued by Ripple’s regulated trust company, and SBI processes it according to Japan’s “Type 4 electronic payment means,” making it a licensed stablecoin product. With this, SBI’s licensed digital asset platform now covers JPYSC, USDC, and RLUSD at the same time, forming a parallel product structure of yen and dollar stablecoins.

The roles played by the three stablecoins are not identical. JPYSC connects local Japanese bank funds and yen-denominated assets; USDC provides broader global on-chain liquidity; RLUSD continues SBI and Ripple’s decade-long collaboration and targets institutional payments and cross-border financial scenarios.

SBI also wants to further promote cross-currency settlement between JPYSC and dollar stablecoins, and explore stablecoin use in card clearing, cross-border payments, and settlement/delivery of tokenized assets. The group has already carried out a digital finance partnership with Visa and tested USDC offline payments.

Tokenizing traditional assets to connect global markets

Once stablecoins solve how funds enter the chain, the next step is to bring investable financial assets onto the chain.

In this part, Startale is becoming an important technical partner for SBI. This March, SBI announced an investment of about $50 million in Startale and plans to include it as an equity-method related company. The two are currently jointly pushing two core products: the yen stablecoin JPYSC and the Layer 1 network Strium for tokenized securities and RWA trading.

The Strium project was officially unveiled in February this year. The network plans to support tokenized stock, bonds, and RWA-related products with 24/7 spot and derivatives trading, while also attempting to build an on-chain market that is not restricted by traditional trading hours. At present, Strium is still in the concept-validation stage, and the timeline for testnet and commercial deployment has not yet been formally set.

SBI also formed a joint venture, SBI Onchain, with the Singapore-licensed RWA platform DigiFT, with SBI holding 60%. The platform plans to build tokenization, legal, and risk-management frameworks around Japanese assets and connect to overseas on-chain capital. SBI’s long-term vision is to convert the group’s internal securities, funds, and other financial products into on-chain assets, and then use stablecoins to complete trading and settlement.

On July 13, SBI’s collaboration with Solana further supplements this framework. According to the plan, the Solana Foundation will take part in the continued development of SBI R3 Japan, which is intended to be renamed “SBI Solana Global.” The business will focus on stablecoins such as JPYSC, RWA including corporate bonds and commercial paper, cross-border settlement, institutional on-chain financial services, and AI agent payments.

This cooperation also reflects SBI strengthening a multi-chain route. The group continues to co-develop Strium with Startale for tokenized financial assets, while still maintaining other plans involving XRPL, Canton, and Ethereum. Solana, meanwhile, provides high-performance public chain infrastructure and a gateway to global liquidity. How responsibilities will be divided among different networks in the future has not been fully disclosed, but SBI has already made it clear that it does not want to bind financial products and customers to a single chain.

From Morpho to Gauntlet, filling on-chain credit and asset management

If stablecoins and RWA mainly solve “how funds and assets get onto the chain,” Morpho and Gauntlet address the next question: after capital enters the chain, how to complete lending, allocation, and earn yields.

In June, SBI participated in a new round of funding for Morpho totaling $175 million. The round was led by Paradigm, a16z crypto, and Ribbit Capital. Compared with earlier DeFi lending models that uniformly set asset and risk parameters within the protocol, Morpho adopts a modular architecture, enabling institutions and developers to create lending markets that are mutually isolated and to choose collateral, risk conditions, and yield strategies themselves.

In SBI’s official strategic materials, Morpho is categorized under the “market layer” of on-chain finance. What SBI values is precisely this credit infrastructure that can be embedded into banking, fintech platforms, and asset management products.

In July, SBI led a $125 million Series C financing round for Gauntlet through its U.S. subsidiary. Gauntlet was known in its early days for DeFi risk models and previously provided market parameters, liquidation-risk, and stress-testing services to multiple lending protocols. In recent years, it has gradually shifted toward yield vault management, designing on-chain allocation strategies based on assets, yield targets, and risk preferences.

Morpho and Gauntlet are strongly complementary in business. Morpho provides the underlying credit network for establishing lending markets, while Gauntlet evaluates risk on top of these markets, designs vaults, and allocates capital. The former is closer to market infrastructure in on-chain finance; the latter takes on asset management and risk optimization functions.

After a recent dense round of deployments, SBI’s on-chain finance map has taken on a clearer outline. The advantage of this structure is that SBI does not need to build all technical modules from scratch. The group can introduce on-chain-native technologies through investments and partnerships, and then leverage its own financial licenses, customer base, and distribution network to drive deployment.

However, this on-chain finance system is still in the construction stage. Many of its planned initiatives are still a way from being scaled and deployed. At present, SBI has already put together a fairly complete strategic framework, but whether different businesses can form synergy—and whether it can ultimately be transformed into an on-chain finance system that runs continuously—still requires time and validation through real-world applications.