A consortium of Japanese firms are set to test a native digital currency in the coming months
With Japanese banks coming together to test the nations’ own digital currency, it’s clear Japan has an intention of pursuing digital currency in the near future. The government is eyeing a launch in FY2022, once the digital currency has been trialled and an avenue for integration is identified.
The consortium of banks will include the biggest three mega-banks in the country. The goal will be to distribute digital currency to all citizens, moving fiat currency to crypto. Though plans are still relatively speculative, the new currency is tentatively called “DCJPY”.
Japan goes digital
While it’s the major banks that are taking the majority of the work, there are roughly 70 Japanese firms in the consortium that will manage and implement the digital currency. The plan will be to launch a yen-based digital currency in fiscal 2022, once the upcoming currency pilots are completed and signed off.
The digital currency will be named “DCJPY” and will be backed by bank deposits. The aim for the currency will be to create a platform that will facilitate speedy large-scale fund transfers and settlements between companies and individuals. The chief executive of cryptocurrency exchange DeCurret is leading the project and expects the project to produce its own money management platform.
For those that have not been paying attention to the developments, the project has been in the works since 2020. The aim is to try and find a way to build a common settlement infrastructure for digital payments, so that the system is streamlined.
The three mega-banks involved have tried to introduce their own digital payment systems, but now they have one focus. Some will participate in experiments, testing the digital currency in a variety of industries to see how implementation would work and whether it would be successful.
The former head of Japan’s Financial Services Agency, Toshihide Endo, stated "A digital currency system built on a bank deposit-backed common platform will fit the CBDC that could be planned and implemented". As one of the most cash-loving countries in the world, authorities have a task on their hand changing things over.