Hokkoku Bank has made history with the introduction of "Tochika," the first stablecoin backed by bank deposits. As a regional institution in Japan, Hokkoku Bank is embracing new Web3 technology through this stablecoin launch, initiating efforts to bring about regulatory changes to permit additional types of stablecoins, including those supported by bank financing.

Tochika's origins stem from Hokkoku's successful collaboration with Suzu City during last year's launch of the "Tochituka" app. With contributions from local merchants, residents can now spend and earn "Tochipo," which can be converted into digital currency by accessing bank reserves.

Japan's cash-centric society has prompted Hokkoku's leadership in enhancing digital payment experiences, offering merchants a competitive 0.5% fee for cashless transactions made via the Tochituka app. By entering the retail market and reducing high-cost service consumption, Hokkoku aims to provide greater convenience to consumers. Despite the involvement of global financial institutions in stablecoin ventures, Hokkoku's focus on retail consumers and support from real bank deposits distinguishes Tochika as a pioneering model in the finance industry, diverging from the standard reserve practices of stablecoins.

This development has raised concerns among cryptocurrency enthusiasts regarding potential challenges and benefits. Building on the success of the Tochituka app, which enables consumers to earn and spend Tochipo points at local stores, Hokkoku Bank plans to introduce person-to-person payments through the app by year-end. By evolving its regional presence, Hokkoku aims to attract other banking entities from Japan's Ishikawa Prefecture to participate in the initiative, underscoring the potential of new Web3 technology to drive digitalization in Japan.