July 6, 2021

For So Long, BOJ Reveals Japan's CBDC Development!

 As is well known that China is a leading country in trying to imply cryptocurrencies issued by the country’s central bank. The digital yuan is China’s digitized fiat currency, also known as the central bank’s digital currency (CBDC). It will be an alternative to fiat currency for the people.

Apart from China, European countries and the United States are also not left behind in this regard. Last month the central banks of France and Switzerland have teamed up to make an experiment. Both central banks have partnered with several commercial banks to test central bank cryptocurrencies (CBDCs). On the other hand, the U.S. announced that it will launch five pilot programs this year to test the potential use of U.S. central bank CBDCs.

Recently, Japan, which is one of the world's largest countries, came forward to provide enlightenment on the CBDC Yen digital product. The latest report states that they will provide more details by the end of next year. According to government lawmakers involved in the plan say that the CBDC has the potential to be the beginning of a conflict between traditional lending and online platform operators.

The Bank of Japan (BOJ) is heading into the second phase of the CBDC experiment at the end of 2022. This ongoing first phase focuses on gaining support and enabling the rapid growth of private innovation by collaborating. The next phase is on the development of the functions and bodies that will be the digital intermediaries of the Yen.

Hideki Murai, head of the Liberal Democratic Party's digital currency panel stated that, "by the end of next year, we will have a clearer picture of how Japan's CBDC operates."

However, the BOJ opposes any conflict between the digital Yen and the traditional financial system. The BOJ’s focus now is to ensure the digital Yen is compatible with the CBDCs of other countries and not just Japan.