A Bank of Japan move to launch a digital currency would be conditional on public support, according to a senior BOJ official who says no final decision has been made even after the announcement of testing to start next year.
“There is no conclusion yet,” said Kazushige Kamiyama, the head of the central bank’s payment system department and the person in charge of looking into a possible digital yen. “At the end of the day there’s no way we can proceed without gaining sufficient understanding from the Japanese public.”
Should the BOJ issue a digital unit in the future it would aim to enhance the transaction ecosystem and coexist with cash and other forms of electronic payment, rather than being a tool for monetary policy, Kamiyama added.
The comments indicate that while issuance of a central bank digital currency in Japan is not set in stone, the BOJ is keen to deepen its understanding of how one would operate and what conditions need to be met to go ahead with the launch of a CBDC.
China’s plans to issue a digital yuan, while still not fleshed out, have heightened global interest in digital currencies among central banks and policy makers. Talk of planned stablecoins, such as Facebook’s Libra, have added to the sense that regular cash has a growing number of competitors that could have wide repercussions on how the financial sector operates.