[Datachain Co., Ltd.] Cross-border stablecoin remittance
infrastructure construction project “Project
Pax” and the start of demonstration experiments with domestic and overseas financial institutions
*Datachain Co., Ltd.*
Press release: September 5, 2024
**
Regarding the launch of the cross-border stablecoin remittance infrastructure project “Project Pax” and the start of demonstration experiments with domestic and overseas financial institutions Progmat,
Inc. (Representative Director: Tatsuya Saito, hereinafter referred to as Progmat) and Datachain Co., Ltd. (Representative Director: Satoshi Hisada, hereinafter referred to as Datachain) are working together on a joint project called “Project” to build a stablecoin (hereinafter referred to as SC) cross-border remittance infrastructure.
Pax” has been launched.
The cross-border remittance market will reach $182 trillion
(approximately 28,000 trillion yen) as of 2022. On the other hand, cross-border remittances are attracting attention to solutions, with the G20 calling for fundamental improvements in four areas: remittance costs, speed of payment, access, and transparency. In this market, Progmat and Datachain aim to realize cross-border remittances that are fast, inexpensive, and can operate 24 hours a day, 365 days a year by utilizing stablecoins.
Project
Pax’s cross-border remittance platform (hereinafter referred to as this platform) uses Swift’s existing API framework to address issues such as AML/CFT, regulatory compliance, and operation structure, as well as hurdles for businesses to use wallets. Realizes stablecoin remittance.
Major domestic and international financial institutions have already decided to participate in the demonstration experiment, which is scheduled to begin soon using a prototype, and cooperation will be expanded to include more countries and financial institutions (names of related financial institutions will be announced in due course). At the same time, we aim for commercialization in 2025.
*1. Background and purpose*
Currently, the issued market capitalization of SC has grown to more than 25 trillion yen, but it is less than 0.5% of the total market capitalization of legal currencies. This is because the use of SC so far has centered on transactions related to crypto assets, and its use as a means of payment in the real economy is only in the future globally.
Even under such circumstances, Hong Kong Tether’s net profit for the first quarter of 2024 amounted to $4.5 billion (approximately 700 billion yen). The market size of SC is expected to grow dramatically as its use as a payment method in the real economy expands in the future, and it is predicted that the market will be worth more than 400 trillion yen by 2028.
As of 2022, the cross-border remittance market boasts a huge market size of $182 trillion (approximately 28,000 trillion yen).
Furthermore, the G20 has set targets for 2027 in four areas: “remittance costs,” “speed of payment,” “access,” and
“transparency,” and drastic improvements in these areas have become a major topic internationally. I am.
In Japan, based on the SC-related law that was enacted ahead of other countries, it is expected that the issuance of compliant SCs and their use in the real economy will begin within 2024. Under these
circumstances, Progmat, in collaboration with major financial institutions and leading companies in the industry, has developed various blockchains, including permissionless (public) blockchains, as infrastructure for issuing SCs in accordance with SC-related laws. “Progmat” corresponding to
He is leading the development of the “Coin” platform and the construction of practical operations. In addition to complying with laws and regulations, this platform also supports accounting and tax aspects, making it possible to issue SCs that companies can use with peace of mind. Also, “Progmat
Various brands of SC using the “Coin” platform can be issued in major legal currencies such as JPY, USD, and EUR, and are expected to be used flexibly both domestically and internationally.
In conventional SC use cases centered on the digital asset market, consideration has focused on P2P remittances that do not go through financial institutions, but cross-border remittances in the real economy require AML/CFT, regulatory compliance, and operations. In addition to construction, the role played by Swift and banks will continue to be important from the perspective of hurdles for companies to use wallets.
In particular, in use cases such as international remittances such as trade settlements by business companies, while promoting the benefits of cross-border remittances using SC, which are fast, cheap, and can operate 24 hours a day, 365 days a year, it is difficult to integrate current processes at business companies. It is also necessary to consider the continuity of Specifically, a solution that conflicts with the current process would impose a large burden on users, such as having to double-track operations and accept corresponding risks, which would hinder its spread, outweighing the benefits of flexibility in remittances. There is a possibility that
From this perspective, while following the international remittance process and user interface (UI) between business companies and financial institutions that are SC users, we will provide a new network that utilizes SC as a remittance process between domestic and overseas financial institutions. This will make it possible to return the benefits of SC to society in a more realistic manner at an earlier stage.
*2. Specific cooperation details and expected effects*
“Project
In “Pax,” Progmat and Datachain will collaborate to build an SC cross-border remittance platform that is compatible with Swift’s API mock/simulation environment.
This platform has undergone a review process by domestic and foreign financial institutions from the initial stage, and will enable SC remittances on the blockchain, as well as SC remittances that span multiple different blockchains, and existing SC remittances that have already been issued. We will implement general-purpose functions that will become a global standard, such as remittance after converting to .
For cross-chain transactions across blockchains, the inter-blockchain communication protocol “IBC *
1” and middleware “LCP *
2”, utilizes the SC contract jointly developed by Progmat and Datachain, and the liquidity pool of TOKI*3, which provides
cross-chain infrastructure.
[Role of each stakeholder in “Project Pax”]
Participating companies Role
Progmat Co., Ltd. Joint development of this platform (cooperation with “Progmat Coin” and overall business design/promotion)
Datachain Development of main infrastructure (cross-border remittance infrastructure, cross-chain, etc.)
Related financial institutions Review of this infrastructure from practical aspects, etc.
By providing this platform, business companies that are SC users can enjoy faster, cheaper international remittances without having to be strongly aware of the existence of SCs or blockchains, and can continue to experience traditional international remittances. It is expected that remittances will become possible, and the quantitative effects will be verified and visualized through demonstration experiments.
By utilizing existing mechanisms, financial institutions do not need to build a new system from scratch, making it possible to provide new remittance options to client companies while reducing investment.
*3. Future plans*
We will immediately begin demonstration experiments using a prototype with a view to commercialization in 2025.
In the process of commercialization, we will expand the number of participating financial institutions and target regions as needed, and build a global standard for international payment networks using SC.
Above
*1) Specification standard to ensure interoperability between blockchains. For more information on IBC, please see below.
IBC official website: < https://www.ibcprotocol.dev/
*2) Middleware that solves the issues in realizing inter-blockchain connections using IBC. For more information on LCP, please see below. LCP official documentation: < https://docs.lcp.network/ >
*3) A partner company of Progmat and Datachain, which provides cross-chain infrastructure and is headquartered in Dubai. For more information on TOKI, please see below.
TOKI official website: < https://toki.finance/ >
-Attachment-
*1. Origin/Vision of “Project Pax”*
This project is not a Web3 project that conflicts with the current financial system. By implementing the advantages of Web3 and blockchain technology in a way that is consistent with the current economic system, we aim to create a sustainable and true impact by fusing both.
Specifically, by building an environment in which everyone can access the financial system more easily and safely, and by eliminating economic disparities and economic issues in the world, including in emerging countries, we will achieve more peace (=PEACE). The aim is to realize a world where Additionally, this initiative is a foundational mechanism for realizing the above, and is positioned as an
indispensable piece (PIECE).
“Pax” is a Latin word that means peace, or “PEACE.” Based on these words “peace” and “peace,” we adopted the Latin word “Pax”, which is the origin of many languages, as the project name, with the hope that it would grow into a system that is more widely used around the world. did.
*2. “Project Pax” related organizations*
(1) Co-developer of “Progmat Coin platform” and “Cross-border remittance platform”
Trade name: Progmat, Inc.
Representative: Tatsuya Saito, Founder and CEO
URL: https://progmat.co.jp/
(2) “Cross-border remittance infrastructure” developer
Trade name: Datachain Co., Ltd.
Representative: Representative Director and CEO Tetsushi Hisata URL: https://datachain.jp/
* Datachain Co., Ltd. is a subsidiary of Speee Co., Ltd.
(Headquarters: Minato-ku, Tokyo, Representative Director: Hideki Otsuka, TSE Standard Market: 4499).
(3) Related financial institutions (as of publication)
Classification Specific name (in alphabetical order)
Japan | City Banks 1. Mizuho Financial Group, Inc.
2. Sumitomo Mitsui Financial Group, Inc.
3. Mitsubishi UFJ Financial Group, Inc.
◆About “Progmat”
We have published a website and explanatory articles, so please visit the URL below.
Website: < https://progmat.co.jp/ >
Explanatory article: < https://note.com/tatsu_s123/n/n03a291fa52ab >
◆About the “Progmat Coin” foundation
The “Progmat Coin” platform is an infrastructure for issuing and managing various SCs.
The materials are publicly available, so please view them from the URL below.
Material: < https://speakerdeck.com/progmat/sc >
Explanatory article: < https://note.com/tatsu_s123/n/n406e5cfa9f1c >
◆About Swift
Official website: < https://www.swift.com/ >