A Yen Without a Redemption Promise: How Crypto-Collateralized "JPYdf" Adds a Second Engine for On-Chain Yen Liquidity

What Was Announced

On September 25, DeltaForesight, founded on September 10, 2025, announced that it had raised a cumulative JPY 324 million through J-KISS convertible equity. Coral Capital led the round, with participation from FFG Venture Business Partners (the venture arm of Fukuoka Financial Group), Animoca Brands, HashPort (a wallet provider with more than 1 million users), DeFimans and Seoul-based Narrative, among others. The funds will go toward developing the "JPY DeFi" protocol ahead of its mainnet launch, external security audits, operations and monitoring, and hiring. CEO Yusuke Shindo previously audited crypto exchanges at Deloitte Tohmatsu, led the crypto exchange registration at Mercoin, and served as CFO of Animoca Brands' Japanese entity.

How JPYdf Works

Users deposit ETH (specifically wstETH, a liquid staking derivative) or USDC as collateral and borrow JPYdf up to an amount below the collateral's value. These two assets are the initial collateral, with more to be added strategically. If the collateral value falls below the required ratio, it is liquidated. Issuance and burning follow the rules coded in smart contracts, and DeltaForesight positions itself not as the "issuer" but as a contributor to design and development. The company states explicitly that it guarantees none of the following: a peg to the yen, price stability, redemption in yen, or preservation of principal.

Why It Is a "Crypto Asset"

According to Shindo, the main test that separates electronic payment instruments from crypto assets under Japan's Payment Services Act is whether the value qualifies as a "currency-denominated asset." JPYC and JPYSC are electronic payment instruments because licensed or registered issuers promise redemption at 1 coin = 1 yen. JPYdf has no entity promising redemption, so it is treated as a crypto asset. DAI, a dollar-denominated crypto-collateralized stablecoin, is likewise listed on Japanese exchanges as a crypto asset.

How the Two Engines Differ

Deposit-backed yen stablecoins can only be issued up to the yen balances the issuer holds. JPYSC's issuance reached about JPY 20.1 billion as of September 7, and from that day it began investing JPY 1 billion of its backing assets in Treasury bills with maturities of three months or less. JPYdf's supply, by contrast, is determined by demand to borrow yen. Borrowing JPYdf against USDC is economically close to a "yen carry trade," borrowing yen while holding dollar assets. As long as the US-Japan interest rate gap persists, some demand from users outside Japan can be expected. Narrative's comment that demand for a yen option is not confined to Japan points to this structure.

Risks Not to Overlook

This structure, however, carries its own risks. When USDC is the collateral, a sharp yen appreciation lowers the collateral's yen value and can trigger cascading liquidations. A scenario like the August 2024 unwinding of the yen carry trade could happen on-chain as well. Whether the price oracle, the liquidation mechanism, and the means of keeping a yen peg without any redemption channel hold up in real market conditions will have to be tested after mainnet launch. Under the amended Financial Instruments and Exchange Act, enacted on July 15, crypto assets will become financial instruments subject to disclosure and insider-trading rules. How an issuer-less design fits the new disclosure regime will also become a question.

[Business Development Insights]

1. On-chain yen liquidity has entered an era with two engines running side by side: "reserve-backed" and "collateral-backed." The former serves domestic payments and accounting, while the latter serves yen-denominated borrowing and investment by crypto holders worldwide. The two are more complementary than competitive, and companies designing yen on-chain businesses should build their payment and liquidity designs on the assumption that both kinds of yen will circulate and be exchanged for each other.
2. The essence of collateral-backed yen is a product that supplies "yen-denominated credit against crypto collateral." What will decide the winners is therefore not the issuance mechanism but the quality of risk management: FX oracles, liquidation design and interest-rate setting. Design and monitoring systems that prevent liquidation cascades during a sharp yen appreciation will become indispensable once institutional investors participate, and they are a business opportunity in their own right.
3. How "issuer-less tokens" fit the new disclosure regime under the amended FIEA will be one of the key regulatory questions ahead. The participation of a regional bank group's venture arm (FFG) suggests that incumbent financial institutions also want to keep both options open. Businesses involved in crypto-asset-type stablecoins need to settle, before mainnet launch, the legal design of who bears responsibility for disclosure.

[Sources]

NADA NEWS, "DeltaForesight, developer of crypto-asset-type stablecoin 'JPYdf,' raises JPY 300 million" (Sept 25, 2026) https://www.nadanews.com/369420/

PR TIMES, DeltaForesight Inc., "DeltaForesight, developer of crypto-asset-type stablecoin 'JPYdf' targeting a yen peg, raises over JPY 300 million via J-KISS" (Sept 25, 2026) https://prtimes.jp/main/html/rd/p/000000001.000190693.html

Atarashii Keizai, "Yen-pegged crypto-asset-type stablecoin 'JPYdf' to be issued; DeltaForesight raises JPY 324 million from Coral Capital, FFG and others" (Sept 25, 2026) https://www.neweconomy.jp/posts/610779

NADA NEWS, "Stablecoin JPYSC begins investing in Treasury bills" (Sept 8, 2026) https://www.nadanews.com/367277/

NADA NEWS, "Crypto FIEA amendment enacted: crypto assets formally become 'financial instruments'" (July 15, 2026) https://www.nadanews.com/355513/

Financial Services Agency, Financial System Council "Working Group on Payment Services" Report (Jan 11, 2022) https://www.fsa.go.jp/singi/singi_kinyu/tosin/20220111/houkoku.pdf

DeltaForesight official website https://deltaforesight.com/