Bank of Japan Joins Other Big Lenders in Digital Yen CBDC Trials: Report

Japan is accelerating its efforts to explore the potential of the blockchain industry in general. Moving forward with its CBDC plans, the Bank of Japan (BoJ) is looking to join a number of other major banks to explore the digital yen. The three largest Japanese banks, although not officially named, are reported to be Mitsubishi UFJ Financial Group Inc., Sumitomo Mitsui Financial Group Inc., and Mizuho Financial Group Inc. Starting next year, these banks will help the BoJ to confirm if there are any problems with the issuance and withdrawal of CBDC.

Japan could see the widespread release of its digital yen by 2026. Before that, the BoJ intends to test whether the CBDC works well under the condition of crisis or no internet connection, it said Nikkei reportThis case with the main banks of Japan can continue for two years.

CBDC or central bank digital currency is built on the blockchain, works like cryptocurrencies, but is issued and controlled by a central bank.

CBDCs are being designed by several countries around the world, with the aim of complementing, rather than replacing, current financial methods and providing an additional payment method for users.

As part of its CBDC research, Japan’s main objective is to ensure that it fits well with the country’s financial and economic infrastructure. According to Kazushige Kamiyama, the head of the BOJ’s payments department revealed that Japan’s CBDC will soon enter a small pilot test.

Japan’s prime minister, Fumio Kashida, has been trying to find ‘new capitalism’ solutions to improve the country’s economy. Lawmakers of the country are not reluctant to try crypto services to end financial inequality in the country.

Back in May, Kishida had it said that Japan will develop and promote the promotion area of ​​Web3, blockchain, NFTs, and the metaverse.

Meanwhile, India, Russia, Jamaica, and China are working on their own CBDCs.

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