Asia spent 2025 laying the groundwork for non-USD stablecoins. Regulators, banks, and crypto firms moved to support local-currency digital assets, even as dollar-backed tokens remained firmly in control of on-chain liquidity. According to the source material, USD stablecoins still account for about 61% of the total $306.702 billion stablecoin market.
Japan and South Korea moved first on local-currency stablecoin plans
Japan and South Korea emerged as the region’s earliest movers. In October 2025, Japanese fintech company JPYC launched what it described as the country’s first legally recognized yen-backed stablecoin. Around the same period, Japan’s three megabanks — MUFG, SMBC, and Mizuho — started pilot programs tied to digital stable assets and tokenized deposits for payments, interbank settlement, and institutional finance.
Japan’s Financial Services Agency publicly backed those efforts in December. Private firms also stepped in. SBI Holdings said it planned to work with blockchain company Startale on fixed-value token issuance and supporting infrastructure, pointing to rising confidence from major financial groups.
South Korean issuers launched products while policy discussions continued
South Korea followed with a similar push, though its market appears more project-led for now. Crypto custody firm BDACS launched KRW1, a won-pegged stablecoin on Avalanche, targeting global payments and remittances. Another won-linked token, KRWQ, went live on Coinbase’s Base network, while KakaoBank advanced its own stablecoin initiative into the development stage.
At the same time, South Korea still does not have a formal regulated framework for stablecoins. The source notes that lawmakers have indicated such a framework is being prepared.
Adoption remains limited as payments use cases take priority
Market size remains small. The report says dollar-based stablecoins still make up more than 60.9% of total stablecoin market capitalization, while yen stablecoins account for only about $6.54 million. That gap shows the current push is centered on diversification rather than replacing the dollar.
For now, the practical use case is payments first, especially cross-border settlement. If adoption broadens in 2026, Asia may develop into a corridor connecting multiple stable currencies, rather than a direct challenger to the dominance of dollar-backed tokens.