Japanese blockchain startup Soramitsu is venturing into new applications for central bank digital currencies (CBDCs), focusing on a cross-border payment system across Asian countries.
Soramitsu is set to deploy Cambodia's CBDC and fiat-pegged stablecoins in a novel payment system aimed at regions including India, China, Japan, and Southeast Asia. The company's announcement on August 8 detailed that these initiatives are an extension of Soramitsu's CB DC expertise, which Has seen its involvement in Cambodia's Bakong CBDC project and Laos's Lao kip.
Cambodia's Bakong, launched in 2020, operates as a public-private partnership enabling Cambodian residents to make payments in stores or through mobile apps using the local riel currency or US dollars. Its adoption has since expanded to countries like Malaysia, Thailand, and Vietnam, with projected figures indicating 8.5 million users and $15 billion in payments processed by the end of 2022.
Soramitsu's aspirations stretch to encompass other Southeast Asian nations. Part of its plan involves establishing a stablecoin exchange in Japan, facilitating currency exchange among different nations. For instance, a user in Thailand could make a purchase on a Japane se e-commerce site using USD- denominated Bakong, which would then be converted into a stablecoin denominated in Japanese Yen.
Soramitsu's spokesperson clarified that the project centers on regulated stablecoins and CBDCs in Japan and other countries, while maintaining separate CBDC systems for each nation. Additionally, the company intends to harness the SORA network and Polkaswap DEX for cross-border issuance and settlement of CBDCs and token swaps.
The anticipated payment network crafted by Soramitsu aims to reduce transaction fees, a feat achieved by utilizing stablecoins that can bypass existing interbank payment networks. To construct this cross-border payments network, Soramitsu has partnered with digital services firm Vivi it and Tama University's Center for Rulemaking Strategy. The company is also collaborating with Japan's Mitsubishi UFJ Trust Bank and other partners to establish the required exchange infrastructure.
