It was announced that a demonstration experiment for CBDC (Central Bank Digital Currency), developed at the initiative of the Bank of Japan, will begin this spring. (News like NHK)
Since the policy announcement to conduct a demonstration experiment in July 2020, Kazunari Kamiyama, director of the Bank of Japan’s settlement organization, said, “We will work to start the demonstration experiment in early 2021.” The schedule has been clarified.
The Bank of Japan has not changed its position that it currently has no plans to issue a CBDC.
First stage of the demonstration experiment
The Bank of Japan has positioned this demonstration experiment as a first step and plans to work with private companies.
The content is to confirm the basic functions in the issuing and distribution of digital currencies, e.g. B. the creation of a general ledger to record the history of transactions in the system. The first phase will take about a year and based on the results we will move on to the second phase to review the next feasibility.
The Bank of Japan announced its policy to conduct demonstration experiments in July 2020 and released a report on specific plans prepared by the research team.
The report explains that the CBDC must have the same functionality as cash. The requirement is “a payment method that anyone can use safely and reliably anytime, anywhere.”
; At present, most digital payments are made through smartphones, but children and the elderly find it difficult to use. Therefore, it should be noted that a terminal is required that can be used by everyone.
Relationship:Bank of Japan on the digital currency demonstration experiment (CBDC) = report
Will it take several years to implement?
In November 2020, Hiromi Yamaoka, the former director of the Bank of Japan’s resolution organization, stated that due to various issues with the introduction of CBDC, it would take several years to prepare for Japan’s issuance.
Mr. Yamaoka pointed out that one of the problems is that a large amount of money can be withdrawn from private bank deposits. He also stated that in order to make the “digital yen” a reality, it is necessary to take action against various problems before it is spent.
Bank of Japan’s Mr. Kamiyama also said that it would take a very high level of judgment to actually get it in and the difficulty of getting it out is an issue.
Relationship:Former BOJ Director “It will take several years to issue a digital yen” = Reuters