They call GYEN (GYEN) the first regulated digital Japanese Yen (JPY) stablecoin. Conversely, they do not reveal what authority regulates the GYEN.
The Yen is the third most traded currency in the world, behind the US Dollar (USD) and the Euro (EUR), IG estimates. Yen trading comprises 8.4% of global currency trades worth $554 billion, IG estimates. The Yen comprises 4.9% of global currency reserves.
In contrast, the Chinese Yuan or Renimibi accounts for 2.16% of the world’s currency trades with a $142 billion volume. The yuan accounts for 1.23% of global currency reserves. The most traded currency is the US Dollar, which comprises 44.15% of currency trades worth $2.9 trillion. They estimate around 63% of global currency reserves are in dollars.
The Yen Gets no Respect
I consider the yen the Rodney Dangerfield of currencies. Like, the comedy legend, the yen gets no respect despite Japan’s powerful economy. For example, pundits rarely mention the yen as a dollar alternative, unlike the Yuan.
Moreover, the yen was worth $0.0074 in US dollars on 8 May 2023. Hence, Mr. Market has contempt for the yen, despite Japan’s economic power.
Yet Japan is the world’s third largest economy, with a nominal gross domestic product (GDP) of $4.9 trillion that accounts for 5.14% of the world’s economy. Hence, some people will wonder if the yen is a dollar alternative. People are seeking a dollar alternative because of the debt ceiling hysteria in the United States.
Conversely, Japan has a heavy exposure to the US debt crisis. Japan is the largest holder of the US national debt. The Japanese government held $1.076 trillion in US Treasury bonds or 14.17% of all treasuries in March 2023. Hence, a debt ceiling crisis in the United States could hurt the yen.
A Regulated JPY Stablecoin
GYEN (GYEN) is an Ethereum (ETH) stablecoin. They claim 100% of GYEN are yen backed. If that is true, yen always backed GYEN on a one-to-one basis.
The GMO-Z.com Trust Company holds all the yen that back the GYEN. To elaborate, each GYEN contains a smart contract that makes yen payments from the GMO-Z.com Trust accounts when spent.
The GMO-Z.com Trust Company has hired WithumSmith+Brown, PC to examine the US bank accounts that hold the GYEN’s GPY reserves each month. WithumSmith+Brown, PC issues monthly attestation reports verifying the yen reserves.
GMO-Z.com Trust held 2.322 trillion GYEN, and ¥2,322 yen, on 31 March 2023. Those numbers stayed the same from 28 February 2023 and 31 January 2023. However, they fell from 3.026 trillion GYEN and Yuan on 31 December 2023.
Issued by GMO Internet Group
A Japanese company they call GMO Internet Group (TSE: 9449) owns the GMO-Z.com Trust and GYEN.
They claim the GMO Internet Group owns the world’s largest FX trading platform, online advertising, internet, and cryptocurrency companies. GMO claims to operate Japan’s most used domain, hosting, cloud, e-commerce, security, and payment solutions.
GMO Internet also issues the ZUSD (ZUSD) US dollar stablecoin. They claim GMO Internet’s network can instantly settle ZUSD and GYEN transactions through Zero, BitGo, and FireBlocks. WithumSmith+Brown, PC, reports GMO held 1.534 million ZUSD and $1.534 million in US accounts on 31 March 2023.
What Value does GYEN offer?
Mr. Market thinks little of GYEN (GYEN). For instance, CoinMarketCap gave GYEN a $0.007357 Coin Price and ranked it 608th on 8 May 2023.
CoinMarketCap gave GYEN a $20.113 million Market Capitalization, a $39.704 million Fully Diluted Market Cap, and a $38,856 24-Hour Market Volume on 8 May 2023. Plus, there was a $9,843 Centralized Exchange (CEX) Volume, and a Decentralized Exchange (DEX) Volume of $28,614 on 8 May 2023. They base those numbers on a Circulating Supply of 2.734 billion GYEN and a Total Supply of 5.397 billion GYEN.
In contrast, CoinMarketCap gave ZUSD (ZUSD) a $1.00 Coin Price, a $1.473 million Market Cap, a Fully Diluted Market Cap of $2.123 million, and a 24-Hour Decentralized Trading Volume of $44 on 8 March 2023. They base those numbers on a Circulating Supply of $1.472 million ZUSD and a Total Supply of 2.122 million ZUSD. ZUSD was CoinMarketCap’s 1,329th ranked cryptocurrency on 8 May 2023.
If you are seeking a dollar-alternative stablecoin, I think GYEN is worth examining. Both ZUSD and GYEN are fascinating stablecoins because a publicly traded company issues them. Smart stablecoin speculators will watch GMO and its products carefully.
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