Bank of Japan Will Not Issue Central Bank Digital Currency Just Yet
At a conference this week, the Bank of Japan has announced that it currently has no plans to issue a Central Bank Digital Currency (CBDC). That said, there was a clear underlying intention to investigate cryptocurrencies and blockchain uses further going forward.
Deputy Governor of BoJ Masayoshi Amamiya delivered his closing remarks in conclusion to a conference with Japan’s Financial Services Agency. He said:
Lastly, we should carefully examine the impacts of IT innovation on currency, payments
and settlements. “Crypto-currencies” and “central bank digital currencies” are now
gathering great attention all over the world. Moreover, these issues also stimulate global
discussions on to what extent central banks should provide their payment and settlement
infrastructures to society.
However, his main address of the world of crypto was one of caution:
The modern two-tiered structure reflects the wisdom of human beings in history to achieve both efficiency and stability in the currency system. In this regard, the issuance of central bank digital currencies for general use could be analogous to allowing households and firms to directly have accounts in the central bank. This may have a large impact on the aforementioned two-tiered currency system and private banks’ financial intermediation.
However, the BoJ’s investigation into blockchain uses continues, and while these remarks may seem as if they are dismissing the idea of a CDBC, it is possible that a more stable future for crypto markets may persuade them to look again.
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