I've been listening to a lot of jpop and I've heard a lot of this chord progression, which is basically IV-iii-i6-ii.
In the song that I've linked below, I think it's in G, so the progression is basically C-Bm-Gm/Bb-Am.
I've heard a lot of other variations of the chord, sometimes it's a diminished chord and other times it's a major chord, so my ears might have heard wrong but I think it's a Gm/Bb.
I know the progression works basically because it's chromatic, but how does a minor i chord function within a key to make this particular song work? And how does a diminished version of that chord function? (in this key a#dim)