Japan's JPYC stablecoin has fallen well short of expectations in its first year, reaching just a quarter of its issuer's circulation target despite a string of corporate partnerships.

“Frankly, I don’t think it’s growing,” CEO Noritaka Okabe told NADA NEWS in an interview, acknowledging that the yen-backed token had failed to gain the traction the company expected. He said trading volume was “not bad,” but wasn’t satisfied with the amount in circulation.

Only 3.2 billion yen (around $20 million) was in circulation as of Oct. 23, compared with cumulative issuance of 12.1 billion yen, Nikkei reported. That data is near the $20.85 million DeFiLlama shows, and reflects tokens that have since been redeemed, underscoring the challenge of keeping JPYC in circulation.

Circulation briefly topped 4.2 billion yen in September after South Korean exchange Upbit listed JPYC. The listing pushed its market price above 1 yen and sent traders rushing to mint new tokens for arbitrage.

Okabe estimated that about 35 billion yen changed hands across Upbit and Uniswap in a single day, before circulation fell back to around 3 billion yen.

That matters for JPYC's business model as the stablecoin is backed by bank deposits and Japanese government bonds, with its issuer earning interest on those reserves. Less money in circulation means less potential interest income.

Okabe blamed the disappointing results in part on a 1 million yen daily issuance limit tied to Japan's Type II funds-transfer rules. JPYC eased its restrictions in May , allowing 1 million yen per request rather than per day, but still restricts rapid repeat transactions.

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