Chuks is a blockchain enthusiast and finance researcher that has covered the crypto sphere for several years. He believes that the evolving technology would change how we do business.
Masayoshi Amamiya, the Bank of Japan executive governor, said that a CBDC may play a central role in interoperability between many emerging digital assets in the country.
The Bank of Japan (BoJ) announced that it has constituted a new research team for a CBDC project. The bank also said that the team replaces a former one that has been researching on the project for several months.
This announcement came at a time the central bank stated that it has no immediate plans to launch a cryptocurrency backed by the bank.
A July 20 statement by BoJ said that it has been researching the feasibility of central bank digital currency (CBDC) though it has no immediate plans to deploy one. The possibility that exists that such currency may be launched in the future even though modalities are not on the table for that yet.
The announcement is a reflection of the country’s government policy of continuing collaboration with several countries with the view to facilitate the practicality of CBDC. The partnership with central banks of Canada, the UK, the EU, Sweden and Switzerland is meant to facilitate this.
PoC for the Yen
When the BoJ joined the collaboration in January, its deputy governor Masayoshi Amamiya said that they are poised to issue a CBDC if there is enough demand for it. The official stance though is that there is no plan yet for launching a digital currency backed by the bank. The continuing research is part of the bank’s policy of developing a proof-of-concept protocol for the yen.
Meanwhile, the Japanese banking group MUFG recently announced that it plans to launch a stablecoin. The bank is just one of many finance corporations that have shown interest in the launch of blockchain-based digital assets. Mizuho, SoftBank and SBI are all actively involved in the blockchain space.
Japan Admits Important Role of CBDC
Masayoshi Amamiya said that a CBDC may play a central role in interoperability between many emerging digital assets in the country.
Some of the issues to be tackled by the research team include retail CBDC, legal ramifications and development of a digital currency that can be accessed offline.
Japan’s central bank may not be under pressure to adopt a CBDC at the moment because the country is not yet cashless. Four out of five merchants still support the use of cash. This is unlike Sweden which I mostly now cashless.