GMO-Z gains USD and Yen stablecoins approval in New York
The New York State Department of Financial Services (DFS) has authorised GMO to develop and issue US dollar and Japanese yen-pegged stablecoins
The DFS has granted GMO-Z.com Trust Company, a subsidiary of Japanese tech giant GMO Internet, a charter under New York Banking Law. The charter allows the tech giant to operate as a limited liability trust company, the Bitlicense regulator revealed.
While making the announcement yesterday, the regulator stated that GMO could issue, administer and redeem Japanese yen and US dollar-pegged stablecoins in New York. The DFS has so far approved 27 charters and licenses to entities offering cryptocurrency services to New York residents, including the charter issued to GMO.
To obtain the charter, GMO had to meet strict requirements for its cybersecurity programs and the federal l standards for anti-money laundering and economic sanctions. The JPY-pegged stablecoin (Ticker: GYEN) and USD-pegged stablecoin (Ticker: ZUSD) can be bought and redeemed directly from the company.
On its part, GMO has partnered strategically with cryptocurrency exchanges that operate globally to boost the accessibility and liquidity of the stablecoins. While the US Dollar-pegged stablecoins are available on the market, GYEN will be the first publicly available stablecoin pegged to the Japanese Yen. Hence, GMO will be the first company to pioneer a global and regulated version of the JPY-pegged stablecoin.
The stablecoins will be available starting January 2021, and institutional firms and retail users can leverage them for trading, institutional hedging, arbitrage, settlements and payments.
GMO-Z Trust President Ken Nakamura is excited by his firm’s move to create the first regulated JPY-pegged stablecoin, a currency most people consider a safe haven asset. “But we are also pioneers and innovators in this space who envision building new applications of blockchain technology that transform our relationship with traditional financial services”, he added.
The USD stablecoins have become popular within the cryptocurrency space. Tether is the leading stablecoin issuer globally, and the USDT coin is currently the third most valuable cryptocurrency in terms of market cap. However, USDT is now facing competition from other stablecoins like the USD Coin (USDC), Binance USD (BUSD), TrueUSD (TUSD) and Paxos Standard (PAX).
The DFS has been granting licenses to companies engaged in crypto-related activities since 2015. Over time, the agency has revised its cryptocurrency regulatory approach to streamline the process for entities to adopt new digital currencies via a self-certification framework.
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Hassan Maishera, @KhareemSudlow
