Japan’s ruling Liberal Democratic Party has unveiled a new national strategy focusing on stablecoins, token banking and AI-powered digital payments. Called the “Next Generation AI/Cross-Chain Financial Concept,” the plan outlines a five-year roadmap for combining AI and blockchain technology across Japan’s financial system.
The proposal aims to reduce reliance on foreign payment networks and fast-growing US dollar stablecoins such as USDT and USDC
Japan wants to build an AI-powered financial system
the The proposal is very focused on “proxy commerce,” where AI systems autonomously make economic decisions and complete payments automatically. Under the plan, AI agents could eventually manage supply chains, business purchasing, inventory systems, and even household purchases without human intervention.
The Liberal Democratic Party believes that blockchain technology is essential because it allows automated payments to remain programmable, secure, and verifiable in real time.
The proposal also pushes for token bank deposits, yen-backed stablecoins, and wholesale digital currency systems linked to the Bank of Japan.
The key policy pillars behind Japan’s crypto and AI strategy
One of the biggest parts of Japan’s new proposal is the focus on… Four major financial Pillars designed to modernize the country’s economy through AI infrastructure and blockchain technology.
The Liberal Democratic Party believes that future economies will increasingly rely on artificial intelligence systems that make automated financial decisions without human intervention.
Under this model, AI agents can manage inventory systems, supply chains, logistics, subscriptions, and even household purchases in real time. Blockchain technology will serve as the payment and verification layer behind those automated transactions, allowing for secure, machine-based commerce 24/7.
- Token deposits and stablecoins in yen
The proposal also pushes Japanese banks towards token deposits and yen-backed stablecoins to improve payment speed and settlement efficiency. The plan encourages the Bank of Japan to accelerate experiments around wholesale digital currency systems, while commercial banks could issue token deposits for large-scale commercial transactions that operate around the clock.
Lawmakers believe stronger yen-based digital payment systems are necessary to compete with fast-growing dollar-backed stablecoins globally.
- Stable forex framework
Japan is also setting rules for stablecoins issued abroad and operating within the country.
The country’s Financial Services Agency recently established a framework that allows approved offshore stablecoins to operate as electronic payment instruments regulated under Japanese law. The move may allow global stablecoin issuers to enter Japan while remaining under local regulatory oversight.
Additionally, the proposal highlights tokenization as a key long-term growth sector for the Japanese economy. Lawmakers want blockchain systems to support tokenized real assets such as government bonds, real estate, receivables, and corporate financial products.
The government itself may eventually issue token government bonds and distribute some public subsidies using programmable smart contracts.
What’s next?
This proposal has not yet become final law, but the Liberal Democratic Party is now expected to work alongside regulators and financial institutions to turn the framework into enforceable policy over the coming years. At the same time, organizers acknowledged that major challenges remain.
The report warned of smart contract hacks, anti-money laundering concerns, privacy risks, and even future quantum computing threats that could weaken existing blockchain security systems.
If implemented successfully, Japan could become one of the first major economies to fully integrate artificial intelligence, stablecoins, token deposits, and blockchain-based finance into its national financial infrastructure.
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