IDA Finance, a Hong Kong-based digital asset firm, has announced a strategic partnership with Japan’s Progmat Inc., along with blockchain companies Datachain and TOKI, to develop a cross-border stablecoin remittance service between Hong Kong and Japan.
The collaboration aims to build a proof-of-concept (PoC) to facilitate blockchain-based stablecoin transactions across the two regions. The initiative seeks to enhance trade efficiency, offer faster settlement times, and test the feasibility of using stablecoins for export-import transactions, specifically in the commodity trade sector.
Proof-of-Concept for Stablecoin Transactions
The PoC will involve denominated stablecoins in Japanese yen and Hong Kong dollars, allowing users to perform real-world cross-border payment requests. This will be done via local off-ramp partners, ensuring compliance and accessibility in both jurisdictions.
According to the partners, the use of stablecoins in trade transactions can dramatically reduce processing times compared to traditional credit transfers. In some cases, payment confirmation can occur in seconds, offering a faster and more transparent alternative to existing systems.
The project will also assess regulatory and compliance considerations, paving the way for potential large-scale adoption in the future.
Division of Responsibilities
Each partner in the consortium brings a specific strength to the project:
- IDA Finance will maintain a 1:1 reserve backing for the stablecoins to ensure full transparency and trust.
- Progmat Inc. will issue the stablecoins via its regulated platform Progmat Coin.
- Datachain will handle the development and implementation of the cross-border transaction technology.
- TOKI, known for its cross-chain expertise, will provide the underlying infrastructure to ensure seamless interoperability between blockchains.
Sean Lee, Co-Founder of IDA Finance, highlighted the significance of the partnership, noting that Japan was Hong Kong’s fifth-largest trading partner in 2023, according to data from the Hong Kong Trade Development Council.
“With stablecoins emerging as a viable alternative to traditional remittance methods, along with regulatory clarity from both regions, the potential for growth in this area is enormous,” said Lee.
Regulatory Momentum in Hong Kong and Japan
The collaboration comes at a time when both Hong Kong and Japan are actively pushing forward stablecoin regulatory frameworks to boost digital asset adoption.
In Hong Kong, Financial Services Secretary Christopher Hui has prioritized tokenization and stablecoins as part of the city’s ambition to become a global crypto hub. Hui introduced a stablecoin regulation bill to the Legislative Council in December 2024, laying the foundation for wider adoption.
Meanwhile, Japanese lawmakers are advancing a crypto reform bill that would permit stablecoins to be backed by short-term government bonds and fixed-term deposits, with an upper backing limit of 50%. The bill, having received Cabinet approval, is now headed to the National Diet for legislative review.
Looking Ahead
The IDA-led project represents a significant step in bridging blockchain innovation with traditional finance across borders. If successful, the initiative could transform how international trade payments are handled between Asia-Pacific economies, offering a new model for real-time, stablecoin-powered cross-border remittances.
More updates on the PoC and pilot tests are expected in the coming months as the project progresses toward deployment.
