Woofun AI reports that JCB and Circle have signed a memorandum of understanding to pilot USDC for cross-border transfers and merchant payments in Japan.

The collaboration will initially focus on a proof of concept for internal cross-border fund transfers, while simultaneously evaluating stablecoin payments for international visitors at Japanese merchants.

A more critical variable is the assessment of technologies supporting interoperability across multiple blockchain networks, ensuring seamless integration within existing payment infrastructures.

This strategic move builds upon a separate initiative launched in January with Digital Garage and Resona Holdings, which tested stablecoin payments at physical stores for domestic merchants. That earlier project aimed to identify technical and operational challenges, setting the stage for broader adoption.

Woofun AI data shows USDC holds a circulating supply of $73 billion, ranking second globally behind Tether’s USDT at roughly $184 billion.

Japan’s market landscape is rapidly evolving with numerous stablecoin initiatives. In June, Nomura was reported to be developing a foreign exchange settlement service using USDC for near-instant settlement. On Monday, Lawson announced plans to test yen-denominated stablecoin payments at a Tokyo location starting in August.

Additionally, Netstars launched a merchant payment service supporting USDC, USDT, and JPYC on Solana and Polygon.

These developments occur within a robust regulatory framework established by amendments to the Payment Services Act in 2023, allowing banks, trust companies, and licensed money transfer providers to issue fiat-backed tokens. In June, the Lower House passed a bill classifying crypto assets as financial instruments, potentially enabling crypto exchange-traded funds and subjecting the sector to stricter market rules.