On March 5, 2026, at the FIN/SUM 2026 finance conference in Tokyo's Marunouchi district, MUFG Bank President Junichi Hanzawa delivered a talk titled "The Banking Industry's Approach to the Age of AI and Blockchain."

FIN/SUM is Japan's largest fintech conference, co-hosted by Nikkei and the Financial Services Agency, and this was its tenth edition. The 2026 theme was FIN/SUM NEXT: The New Financial Ecosystem Built by AI and Blockchain. Hanzawa also chairs the Japanese Bankers Association, which gave his remarks the weight of an industry position.

"Financial Transactions Are Moving On-Chain"

The core of the talk was blunt: financial transactions will increasingly happen on-chain.

As security tokens sit alongside digital settlement rails like tokenized deposits and stablecoins, trading and settlement converge onto the blockchain. Stocks and bonds become digital tokens, and the money that buys them settles instantly in digital currency. That is the network Hanzawa expects to form.

He also pointed to cross-border payments, where demand keeps rising with international trade and cross-border e-commerce. Today's international transfers run through the correspondent banking model: multiple banks in the chain, high fees, several days in transit, and almost no visibility into where the money is. Blockchain, in his view, can address all three at once.

Japan's Three Megabanks Unite for a Joint Stablecoin

Of the specifics Hanzawa touched on, the one that drew the most attention was the joint stablecoin from MUFG Bank, Sumitomo Mitsui Banking Corporation, and Mizuho Bank.

The plan surfaced in reports in October 2025, and in November the Financial Services Agency selected it for support as the first case under its Payment Innovation Project (PIP), a program built specifically around blockchain-based payments. Six parties took part: the three megabanks plus Mitsubishi Corporation, Mitsubishi UFJ Trust and Banking, and Progmat. The three banks act as joint trustors, Mitsubishi UFJ Trust serves as the single trustee, and a trust-type stablecoin is issued under a single brand.

Two design choices matter. First, the trust structure. Stablecoins issued under a funds transfer license, like JPYC, carry a per-transaction cap of one million yen (roughly $6,700); the trust type has no such limit, which makes large corporate settlements viable.

Second, three competitors are unifying the standard and issuing under one brand, which avoids a scatter of incompatible tokens choking adoption before it starts.

The first pilot tested cross-border settlement between Mitsubishi Corporation's Japanese and overseas offices. The trading house alone has more than 240 major operating companies, so the fees and paperwork on inter-office transfers add up. The technical backbone is Progmat, a platform led in development by Mitsubishi UFJ Trust and incorporated in October 2023 with investment from the megabanks, NTT Data, and JPX Market Innovation & Research.

Things have moved since. On June 10, 2026, the three banks announced they are targeting actual commercial transactions using the joint stablecoin during fiscal 2026, and signed a memorandum to establish a council covering issuance infrastructure, scheme design, and governance. Practical use had originally been expected within fiscal 2025, so the timeline has slipped. A dollar-denominated version is under consideration alongside the yen one.

AI and Blockchain as Complementary Partners

Toward the end, Hanzawa framed the relationship between the two technologies. AI handles better decision-making; blockchain handles recording, exchanging, and transferring value correctly. They are not rivals but counterparts.

Banking has always run on data-driven judgment in credit assessment and on strict management of transaction records. That, he argued, is exactly why both technologies fit the industry so naturally.

He also insisted that innovation does not change banking's public role, which rests on safety and security. Rather than building everything in-house, he said, banks should deepen ties with startups and technology firms.

How Global Banking Giants Compare: JPMorgan and HSBC

Japan's approach comes into focus against what large foreign banks are doing.

JPMorgan (US) has run JPM Coin (JPMD), a dollar deposit token, since 2019 through its blockchain arm Kinexys, formerly Onyx. It tokenizes the bank's own deposits and offers institutional clients real-time settlement around the clock. In late 2025 it began issuing JPMD on Base, the public blockchain from Coinbase, and in January 2026 announced integration with Canton Network, a public chain with privacy features. Kinexys is reported to process on the order of $10 billion in settlements per day.

JPMorgan's approach is self-contained. It leverages its own client base and infrastructure to build a digital settlement ecosystem alone.

HSBC (UK) built HSBC Orion, a digital asset platform, and leads on digital bond issuance. It has handled more than $3.5 billion in digitally native bonds, including the Hong Kong government's multi-currency digital bond. In 2025 it launched tokenized deposit services for corporate clients in Hong Kong, with expansion to the US and UAE planned for the first half of 2026. It also participates in the Hong Kong Monetary Authority's Project Ensemble, testing real-time cross-border settlement.

HSBC's approach is Asia-based and globally staged. It sharpens the technology in Hong Kong and expands market by market as regulation allows.

Japan's Third Way

Lined up side by side, the Japanese choice looks unusual. JPMorgan goes alone; HSBC works from an Asian financial hub. Japan's three megabanks chose to cooperate and build shared infrastructure. Unify the standard, the thinking goes, and you lift the whole country's digital payment rails at once.

The other distinguishing feature is proximity to the regulator. The FSA stood up PIP and supports the work directly, weighing in on legal interpretation and compliance questions from the pilot stage. It is a sharp contrast with the long stretch of regulatory uncertainty in the US.

The problems have not gone away. Kinexys moves roughly $10 billion a day while the megabanks are still crossing from pilot to commercial use, and their timeline has already slipped once. The complexity of the trust scheme and the practical rules for anti-money-laundering remain unfinished. Domestically, JPYC started circulating in October 2025, with SBI's JPYSC and Japan Blockchain Base's EJPY behind it. Whether the reach that cooperation buys outweighs the slowness it costs is the open question.

How are banks in your country using blockchain and AI? Would you trust a stablecoin issued by a bank? We'd love to hear what you think.

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