Bank of Japan announced the latest plan to test and issue the national digital currency. Japanese authorities are worried about the recent advance from the Chinese government and want to accelerate their efforts on issuing a digital currency.
The recent meetings and discussion between BOJ executives and industry experts were focused on central bank digital currency (CBDC) as a high priority topic. The bank and authorities regard CBDC as a national security aspect, according to a local news outlet.
Takeshi Kimura, the central bank’s Payment and Settlement Systems Department director-general said his team is working with the private sector to gain more knowledge about the technical aspects of CBCD.
He said easy access to the new digital currency is one of the most characteristics to consider. Resiliency is the other critical feature that CBDC need. The digital currency has to be able to serve customers in any condition like natural disasters and other emergencies.
There has to be a decline in using regular currency, If Bank of japan wants to issue a functional digital one, according to Kimura. In other words, when cashless payments rise in Japan, it will be an indicator that a national digital currency is needed.
Right now, Japan is one of the countries in the world with the most circulation of traditional banknotes. After all, the infrastructures for a national digital payment system should be ready and work as a force for people to migrate to more efficient solutions.
Many countries around the world – including Japan – are worried about the digital yuan plans in China. They believe that the communist party wants to dominate the global financial system and push the USD away. As a result, many of the national banks around the world have started plans to issue digital currencies.
Japan, as one of the leading economies in the world, has to try better in issuing a CBDC. In June, an LDP policy committee released a proposal that said:
“Having China with its hands first on the technological standards for CBDC could become a national security threat.”
So, the government has acknowledged this urge and is trying its best to accelerate the programs.
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