Bank Of Japan Starts Experimenting With CBDC: Report

Bank of Japan starts experimenting with CBDCs according to the announcement today with the possibility of issuing its own central bank digital currency so let’s read more in our latest crypto news.

The decision o ramp up the timeline coincides with the nations across the world that are making strides in creating their own digital currencies. China for example, already laid out the plans to create a digitized Yuan with pilot programs that are already under its belt. Previously, the Eastern Caribbean Central Bank launched its digital currency.

In a statement, the BOJ stated that this is the first phase of experiments that will be carried out by March 2022 and will focus on the technical issues of distributing, launching, and redeeming its CBDC. Once that is completed, the central bank will transition to the second phase of the experiments and will provide more details about the functions and payments infrastructure. BOJ Executive Director Shinchi Uchida stated that the central bank will launch a pilot program that will involve payment service providers and users:

 “While there is no change in the BOJ’s stance it currently has no plan to issue CBDC, we believe initiating experiments at this stage is a necessary step.”

The creation of the centralized digital currency was a topic of interest for central banks across the world and with the ongoing pandemic and new innovations flooding the market, the cash payments dropped about 5% in 2020. The cash usage is dwindling as well with decentralized digital currencies becoming mainstream and the adoption of the state-backed digital currency posing as the real alternative in the near future.

In February, the US Federal Reserve Chair Jerome Powell announced that the central banks are keen on creating their own CBDC in order to bolster the government payment systems. After his statement, the Federal Reserve released a new document that discussed the objectives and preconditions for a general-purpose central CBDC. China already started testing its digital currency by distributing .
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5 million in Yuan to the citizens. While China is undoubtedly the leader, the bank of Japan starts experimenting as well and the US is not far behind too. The BoJ ambitious timeline put the nation at the forefront of the CBDC race.