Japanese blockchain startup Soramitsu is exploring new central bank digital currency (CBDC) applications with a new project on the cross-border payment system for Asian countries.
Soramitsu will deploy Cambodia’s CBDC and fiat-pegged stablecoins as part of its new payment system targeting countries like India, China and Japan and regions like Southeast Asia.
The new project builds upon Soramitsu’s CBDC expertise, including its involvement in the Asian CBDC project Bakong in Cambodia and Laos’ Lao kip, Nikkei reported on Aug. 8.
Launched in 2020, Cambodia’s Bakong is a public-private initiative allowing Cambodian residents to pay at stores or send money through a mobile app using the local riel currency or U.S. dollars. Since its launch, Bakong’s adoption has expanded to countries like Malaysia, Thailand and Vietnam. By late 2022, Bakong reportedly had 8.5 million users and handled around $15 billion in payments.
The report notes Soramitsu is targeting expansion to other Southeast Asian countries.
As part of the project, Soramitsu plans to establish a Japanese exchange for stablecoins, which would allow conversions of currencies from diverse countries, the report says. For example, if a Thai user wanted to purchase something from a Japanese e-commerce site, the report noted, the payment would be sent as a dollar-denominated Bakong and converted to a yen-denominated stablecoin.
One of the features of Soramitsu’s planned payment network is an anticipated reduction in transaction fees. According to the firm, the fee reduction would be enabled by implementing stablecoins, which can be transferred without going through existing interbank payment networks.
Related: India negotiates cross-border CBDC payments with global central banks
To build the cross-border payment network, Soramitsu formed a team with Tokyo-based digital services company Vivit and the Tama University Center for Rule-making Strategies. It is looking to partner with major e-commerce sites.
The firm is also working with Japan’s Mitsubishi UFJ Trust and Banking and other partners to create the necessary exchange infrastructure.
Soramitsu did not immediately respond to Cointelegraph’s request for comment. This article will be updated pending new information.
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