- A Japanese startup collaborates with several brands to create a cross-border payment system.
- Soramitsu has plans to explore central bank digital currency applications.
A Japanese blockchain startup company, Soramitsu, has disclosed plans to explore new central bank digital currency (CBDC) applications while including a new project on cross-border payment systems to create a link between Asian countries.
Soramitsu plans to deploy Cambodia’s CBDC and fiat-pegged stablecoins as a part of its new payment system targeted at Asian countries like China, Japan and India, and other Southeast Asian regions.
The new project the startup is embarking on is building up on its CBDC expertise, including its involvement in the Asian CBDC project Bakong in Cambodia and Laos’ Laokpip, which was announced on August 8 by the firm.
The public-private initiative launched in 2020, Cambodia’s Bakong, enables Cambodian residents to pay at stores or send money through a mobile app that accepts the local riel currency or in U.S. dollars. Since its launch three years ago, the initiative has expanded to countries like Malaysia, Vietnam, and Thailand. Data reports showed that by late 2022, Bakong had 8.5 million users and could handle $15 million in payments and transactions.
The recent report by Soramitsu notes that the startup is targeting an expansion toward other Southeast Asian countries. As part of the project, the start-up plans to establish a Japanese exchange for stablecoins that would aid in converting currencies from diverse countries, the report adds.
An example is a Thai user wanting to purchase something from a Japanese online market. The payment would be sent to the seller as a dollar-denominated bakong and then converted to a yen-denominated stablecoin. The project is aimed at regulated stablecoins in Japan and other countries, with the inclusion of CBDC.
A representative from Soramitsu also told Cointelegraph that the startup plans to focus on linkages between Central bank digital currencies to ensure each country has its own CBDC system adequately maintained. In addition, Soramitsu is a contributor to the SORA network and the Polkaswap DEX, so the company plans to look into ways to use the public, permissionless SORA network to foster cross-border issuance and settlement of CBDC with token swapping on Polkaswap.
One of the planned features for the project, as disclosed by the Soramitsu representative, is a well-anticipated reduction in transaction fees and according to the startup, the reduction in transaction fees would be enabled by the implementation of stablecoins, which could be transferred without making use of existing interbank payment networks.
Soramitsu also partnered with a Tokyo-based team for digital service, Vivit, and Tama university center for rule-making strategies to build the cross-border payment network. The company is also looking to partner with some major e-commerce sites.
Conclusion
Soramitsu is also working with Japan’s well-known Mitsubishi UFJ Trust and Banking as well as other partners to enable them to create the necessary exchange infrastructure needed.
