Sumitomo Mitsui Trust Bank has teamed up with Hashport, a blockchain infrastructure provider, to create a program that lets people swap loyalty points for JPYC — Japan's first onchain yen-pegged stablecoin. The partnership marks the country's first initiative where reward points from various programs can be converted directly into a stable digital currency.
How the conversion will work
Under the plan, users will be able to send loyalty points from participating retailers or service providers into a Hashport-powered system. Those points get converted into JPYC, which runs on the blockchain and holds a 1:1 value with the Japanese yen. The bank and Hashport are building the technical rails to handle the exchange, though they haven't announced a launch date yet.
Loyalty points in Japan are a massive market. The partnership has the potential to inject up to ¥2.8 trillion — roughly $19 billion — into the country's stablecoin ecosystem, according to estimates from the companies.
Why stablecoins matter for loyalty programs
Most loyalty points today are locked inside individual programs. They expire, lose value over time, or can only be spent at specific stores. By converting them into JPYC, users get a token that can be sent, saved, or spent anywhere that accepts the stablecoin. The move could give loyalty points the liquidity of cash without the volatility of other cryptocurrencies.
Sumitomo Mitsui Trust is one of Japan's largest trust banks, and its involvement signals that established financial institutions see stablecoins as a practical bridge between traditional reward systems and digital finance. Hashport provides the middleware that connects different blockchains, making it possible to move value across networks.
Regulatory landscape
Japan has strict rules for stablecoins. The country passed a law in 2022 requiring stablecoin issuers to hold reserves and be licensed. JPYC is already registered and compliant, which allowed the trust bank to move forward with the partnership. The Bank of Japan and the Financial Services Agency have been watching the space closely, and this project fits within the framework they've set.
Other banks and loyalty program operators are likely watching, too. If the Sumitomo Mitsui Trust and Hashport pilot works, it could open the door for similar conversions at scale, unlocking a pool of value that has been sitting idle in consumer wallets.
Neither Sumitomo Mitsui Trust nor Hashport has given a timeline for when the conversion service will go live. They said they'll continue testing the system and work on integrating with more loyalty partners. The next milestone will be a public trial, likely involving a small group of users before a wider rollout.
