White Paper
This project proposes the insurance of JPY-pegged stablecoin as a prepaid payment method under the Fund Settlement Law. In recent years, payment with crypto assets such as Bitcoin and Ether became widely accepted. However, real-world applications of such payments encountered numerous problems due to the volatile nature of said currencies. Although JPY-pegged stablecoins are issued in Japan, their user base is primarily located within Japan, undermining the advantages of crypto assets in the global market. As a result, we will widely issue the JPY-pegged stablecoin “JPYW (World)” to the global market, as a prepaid payment method, hence gapping the bridge between crypto-assets and the real economy.
As a P2P electronic currency system, Bitcoin was born in 2008, to enable direct payment between users with blockchain technology, without the intervention of financial institutions. In reality, the volatility, low payment speed, and high payment fees make Bitcoin payments far from ideal. With ever-increasing commodity prices, it is clear in some cases, that Bitcoin is not meant to be a valid payment method. Since then, discussions regarding payments using blockchain technology erupted worldwide, and answers came in from all fronts. Among them, the invention of stablecoin, with the linkage of crypto value and fiat currency in mind, paved the way to a better solution that counters the volatility of crypto assets.
Stablecoins are generally issued on the Ethereum network as ERC20 tokens. However, current Stablecoins such as USDT, issued by Tether, are usually USD-pegged. And this is quite inconvenient for Japanese users. Therefore, in this project, we will issue the JPY-pegged stablecoin JPYW as a prepaid payment method under the Fund Settlement Law, which will eliminate the “unsuitable for social use” barrier faced by crypto-assets and current stablecoins.
Crypto assets are borderless. Compared to traditional systems, crypto-assets can be freely deposited and transferred with a personal crypto wallet, both quick and cost-efficient. However, traditional crypto assets such as Bitcoin are still prone to the risk of price fluctuations, as well as additional problems when circulating in the real world.
On the other hand, the value of the crypto asset market is estimated to reach 340 trillion yen at the end of 2021, further boosting the number of token holders. As a JPY-pegged stablecoin, JPYW also meets the crypto assets needs for the global market, as a typical safe-haven currency.
In modern times, the way of money is slowly changing as well. With the advancement of a cashless society, commercial trades are occurring on the internet more frequently.
The trading market of NFT (Non-Fungible Tokens) based on contents such as digitized art, photography, video, and music, is expanding steadily. Soon, the trend of digitization and a cashless society will become inseparable from crypto assets.
Under such circumstances, JPYW opens up a new lifestyle of the future. As a stablecoin, JPYW will become a hub connecting the digital life of the present and the future.
JPYW is a "private-owned prepaid payment method" under the Fund Settlement Law. We have the designed JPYW to be roughly 1 JPYW = 1 yen. Users are freed from the traditional risk of price fluctuations and are allowed to make payments with JPYW, a JPY-pegged stablecoin as a prepaid payment method.
The stabilization mechanism to allow JPYW to stay as such a payment method is explained as follows.
On occasions, the price of 1 JPYW may fall below 1 yen on average for a prolonged period, due to reasons such as secondary distributions on a decentralized exchange. When this occurs, the price of JPYW will be increased by one of the following methods:
・Deposit to the Legal Affairs Bureau as stipulated in the Fund Settlement Law (deposit amount equals no less than 50% of the unused balance on the reference date).
・Receive financial institution guarantee as stipulated in the Fund Settlement Law. Initially, a cash pledge will be deposited to the Legal Affairs Bureau. In case the deposit amount increases in the future, users will be notified on the PassPay website and other media beforehand.
By doing so, it is believed that in the case of the bankruptcy of PassPay, the possibility of harm to the users will be greatly reduced. This however does not guarantee the protection of the principal JPYW issued or sold by the company.
On occasions, the price of 1 JPYW may exceed 1 yen on average for a prolonged period, due to reasons such as secondary distributions on a decentralized exchange. When this occurs, the price of JPYW will be decreased by the following method:
・JPYW continues to be sold on the PassPay website
Nevertheless, if the circulation price in the secondary distribution exceeds 1 yen per JPYW, together with deposit amount exceeding that is stipulated by the Fund Settlement Law (hereinafter referred to as deposit surplus, including financial institution guarantee), announcements will be made on the company’s website before withdrawing the excessive deposits (total withdraw amount is determined so that the average secondary distribution price does not fall below 1 yen, within the range of 30% of total deposit amount or less), to prevent a decrease in fund efficiency.
We are planning to issue 100 million JPYW on the first batch. Then a predetermined ratio of JPYW will be supplied. Details are described in 2.4.
If PassPay abolishes the business of issuing JPYW, the Company will refund the users at 1 JPYW = 1 yen under the Fund Settlement Law and other laws and regulations.
If the issuer goes bankrupt, the user's holdings will continue to be recorded on the Ethereum blockchain despite that JPYW will no longer be available for purchase. The bankruptcy proceedings will take any leftover deposits to reimburse the users.
Under the Funds Settlement Law, it is obligatory for a private token issuer to pay and maintain a margin pledge to the Legal Affairs Bureau in accordance with the Fund Settlement Law. If PassPay were to go bankrupt, users will get a refund based on the refund procedure.
JPYW is a private-owned prepaid payment method issued by PassPay Co., Ltd., a company established under the laws of Japan. Since JPYW is a currency-denominated asset it does not fall under the category of crypto-assets under the Fund Settlement Law.
Currently, the DeFi (decentralized finance) market is expanding rapidly, and the decentralized exchange (DEX) has obtained a certain number of users. JPYW, an ERC20 token, can, although not recommended, be used for secondary trades through decentralized exchanges, etc.
To purchase goods and services on our E-Commerce website
JPYW can be used to purchase goods and services on our E-Commerce website at the rate of 1 JPYW = 1 yen.
Up to 100 million JPYW will be issued in the first batch. When 90% or more of the issuance limit has been in circulation, additional JPYW will be issued in sequence. JPYW is an ERC20 token, and the contract address does not change with the issuing of additional JPYW.
We currently recommend the following 2 methods:
・Purchase with Japanese yen from our website