SBI VC Trade said it will open applications for JPYSC Lending on July 16, with lending to begin on July 23. The product lets holders of the yen-backed stablecoin JPYSC lend their tokens to the exchange in return for an initial 3% annual rate. SBI describes it as Japan’s first lending service built around a trust-type yen stablecoin.
The service will run on SBI’s VCTRADE platform. Customers lend JPYSC to SBI VC Trade and receive a fee at the end of the term along with the full amount lent. The rollout expands SBI’s stablecoin strategy beyond payments. JPYSC itself was launched recently as Japan’s first trust bank-backed yen stablecoin, issued by SBI Shinsei Trust Bank, and unlike earlier fund-transfer-type tokens, it is not subject to the 1 million yen cap.
A fixed 12-week term with no early exit
JPYSC Lending is structured as a simple loan with a fixed 12-week term. Holders hand over their tokens to the exchange, which pays a fee based on the size and duration of the loan, then returns principal and earnings at maturity. Applications are approved in the order they arrive. Once a lending contract is in place, users cannot withdraw early.
The opening 3% rate sits above the 0.325% to 1% range SBI VC Trade lists for ordinary yen time deposits. After the launch period, the exchange expects the same 12-week product to offer between 1% and 3%, depending on market conditions and demand. SBI and Singapore’s Startale Group first introduced JPYSC in February as a settlement token for on-chain finance. The lending product adds an income use case to that setup.
Tax treatment is materially different from bank deposits
Tax treatment is one of the biggest differences. A yen time deposit is taxed at a flat 20.315%, while income from JPYSC Lending is added to a person’s other income and taxed according to that bracket. Holders whose annual income from the product stays below 200,000 yen and who meet certain conditions may not need to file a tax return. Above that line, the combined national and local tax burden can rise to as much as 55.945%.
No deposit insurance and no access to the tokens during the term
SBI VC Trade also makes clear that JPYSC Lending does not come with the protections attached to a bank deposit. It is not covered by deposit insurance, and the JPYSC borrowed by the exchange is not segregated from the company’s own funds under Japan’s Fund Settlement Act. If the company were to fail, lenders could lose part or all of the assets they lent.
During the contract period, holders also give up the right to sell, transfer, or pledge the tokens. SBI says JPYSC is not the Japanese yen itself and carries no government guarantee. The exchange will also run two prize draws distributing JPYSC, shortly after its parent company led a $76 million funding round for institutional exchange EDX Markets.