Japan must cooperate with Europe and the United States in creating a global standard on the technical aspects of issuing a central bank digital currency (CBDC), the chief of Japan’s central bank said on Friday. Several central banks across the world are actively working on their national digital currencies.
Bank of Japan is yet to make a decision on its CBDC.
While the Bank of Japan (BOJ) had made no decision yet on whether to issue its own CBDC, it was proceeding with experiments and a plan to deliberate on specific designs of one, and Governor Haruhiko Kuroda told parliament. Asked by a lawmaker on whether Japan would be able to decide around 2026 whether it can issue a CBDC, Kuroda said: “Personally, I think that’s the case.” Kuroda added that the final decision on whether Japan would issue a CBDC must be made after close consultation between the BOJ, government, and private entities.
Tokyo is closely watching China’s fast-paced development in issuing its digital yuan.
In the same parliament session, Japan’s Finance Minister Shunichi Suzuki said that they are closely watching China’s fast-paced development of issuing a digital yuan. A global front-runner in CBDCs, China has moved much faster than the Group of 7 nations, including Japan. China’s central bank said it was ready to provide digital yuan payment services to the Beijing Winter Olympics visitors last week. The BOJ started the first phase of its experiment on CBDC in April last year and planned to move to the second phase this year. But the central bank has said it has no immediate plans to issue a digital yen. Pilot programmes, if any, won’t take place until 2023 at the earliest.