The Japanese Government and Bank Work Together on the Digital Yen with a Goal of a Resolution in 2024
After a “national discussion,” and certainly not before 2026, will a final decision be reached?
In its first formal meeting with the Japanese government, the Bank of Japan (BoJ) discussed the possibility of creating a CBDC, or central bank digital currency.
Local TV station NHK reports that on January 26, the government and the BoJ agreed to tackle the legal complexities of the digital yen’s issuance, with the aim of finishing by the spring of 2024.
Keep in mind that the Bank of Japan and the government have not officially announced the introduction of a digital yen just yet.
A group of experts from the Ministry of Finance recommended speeding up the release of a digital yen to the Bank of Japan in December 2023.
The panelists stressed that physical currency and the CBDC should coexist and that the BoJ should limit the preservation of personal data.
The BoJ completed phase two of CBDC testing in May 2023. There were five intermediates and one hundred thousand consumers in this one-year trial, which tested transaction loads between 500 and three thousand per second.
With this accomplishment under its belt, the BoJ launched its anticipated CBDC pilot project, which aimed to assess the “end-to-end process flow” and link up with external systems.
Japan still views CBDCs favorably, despite the country’s image as a cash-based nation. In contrast, US politicians and presidential candidates have been vocally opposed to CBDC bills and programs.
Japanese companies may also be exempt from paying taxes on “unrealized gains” on bitcoin assets as of April 2024.
Many Asian nations are becoming more accepting of CBDCs; for example, China has launched its digital yuan, while South Korea, India, Singapore, Malaysia, and Hong Kong are all doing CBDC research.
Additionally, as stated in early January, the National Bank of Cambodia will introduce a CBDC in Cambodia by the end of 2024.
Officials from the financial institution have come clean about their plans to launch “Lanka Pay” and “Central Bank Digital Currencies.”
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