According to NHK news, Japan is inching closer to issuing a central bank digital currency (CBDC). Also known as the digital yen, CBDCs will be the subject of an expert panel’s investigation by the finance ministry. According to the report, the discussions will begin in April 2023.
The ministry’s panel will likely discuss developing a framework for a digital currency supported by the central bank. They will use the outcome from a study carried out by the Bank of Japan (BOJ) for over two years up until this month. However, the BOJ has not decided whether Japan will issue a CBDC, even though the bank spent two years experimenting with the idea.
What are Japan’s authorities saying about the CBDC project?
Finance Minister Shunichi Suzuki, told reporters on Friday that the government is still looking into different methods to fulfill its commitment to consider the viability of a CBDC. The experimental program might extend for several years, according to the central bank. If the government were to start issuing a CBDC for public use, some laws may need to be changed.
BOJ Governor Haruhiko Kuroda said that they want to ensure the coexistence of CBDC with various other forms of money. In an attempt to modernize financial institutions and expedite domestic and international payments, central banks from various countries have increased their efforts to create digital currencies. Japan and other developed nations are attempting to overtake China, which is leading the global CBDC race and has accelerated the development of pilot programs for retail payments.
Moreover, the U.S. Federal Reserve (Fed) has been investigating a digital dollar that many have begun to call “Fedcoin.” According to Fed officials, elected officials would need to support the launch of any such asset. India has also launched a pilot program for its CBDC initiative. Additionally, the European Central Bank is expected to decide on its plans for a digital euro sometime later this year.