JPYC Halts Ethereum and Polygon Issuance After Glitch

Japan’s yen-pegged stablecoin issuer JPYC has temporarily suspended issuance reservations on the Ethereum and Polygon networks after a glitch affected its issuance process.

JPYC announced the disruption on September 17, saying reservations for new JPYC issuance on Ethereum had been paused while the company investigated the cause. The suspension was subsequently extended to Polygon. The company apologized to users and said further information would be provided once the cause of the issue is identified.

The disruption affects the process through which users reserve the issuance of new JPYC tokens. JPYC is designed as a stablecoin linked to the Japanese yen and is issued across multiple blockchain networks, including Ethereum, Polygon and Avalanche.

JPYC has not publicly disclosed the technical details of the glitch or confirmed what caused the problem. The company described the Ethereum and Polygon issuance reservations as temporarily suspended and said its investigation was ongoing. This means the latest action is a precautionary suspension of new issuance reservations rather than an announcement that the JPYC token itself has been permanently halted.

The incident comes as interest in JPYC continues to grow. Korean cryptocurrency exchange Upbit recently began listing the yen stablecoin, bringing additional attention and trading activity to the asset. Reports said the suspension of new issuance, combined with increased demand, contributed to JPYC trading significantly above its intended yen peg on secondary markets.

Stablecoins depend heavily on reliable issuance and redemption mechanisms to maintain their intended value. When new issuance is temporarily unavailable, market participants cannot use the normal mint-and-arbitrage process as easily to bring the token’s market price back toward its target.

For JPYC, the incident highlights the operational challenges stablecoin issuers can face as they expand across multiple blockchain networks and attract users from different markets.

JPYC has yet to announce when Ethereum and Polygon issuance reservations will resume. Until the investigation is completed, users will have to wait for the company’s further updates on the cause of the glitch and the restoration of the affected services.