Japan’s Central Bank Suspends Plans For CBDC

Despite testing the technical feasibility of issuing a central bank digital currency (CBDC) in 2021 and starting the second phase of testing in April, the Japanese central bank has decided to suspend plans to introduce a CBDC because it failed to attract public attention.

The Bank of Japan (BOJ) will not consider implementing a CBDC shortly due to the popularity of credit cards, online banking, and crypto payment tools among consumers in the country, Asia Times’ Sayuri Shirai reported on July 20.

As that happens, the private sector encourages the widespread use of digital and mobile payment technologies. In addition, most Japanese nationals are believed to have unhindered access to the banking system, and there is no need to promote financial inclusion for any disadvantaged group.

On top of that, most consumers find private sector-based payment instruments more attractive due to benefits such as points they can receive and accumulate, then use to pay for goods or other services.

The BOJ kicked off a pilot phase to determine the feasibility of issuing a CBDC in April 2021, running through March 2022, then moving into a second phase to determine its expanded functions.

In mid-April, BOJ CEO Shinichi Uchida ruled out the possibility of the central bank introducing a digital yen to achieve negative interest rates while the central bank is still preparing for the CBDC test.

The third phase has been paused in which the organization envisages having private businesses and end-users participate in a pilot program if deemed necessary.

Meanwhile, a new survey conducted by Fintech and blockchain company Ripple has found that 70% of leaders in the financial sector believe CBDCs have the potential to drive social changes in the next year, with advantages such as financial inclusion and access to credit.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page

Harold

CoinCu News