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Governor of the Bank of Japan: Preparation of the national digital currency should not be postponed until the last moment

The governor of the Bank of Japan said in a new statement that postponing the preparation of such a currency until the last minute was not a good policy, stressing that the first phase of the official digital currency test would begin in the coming spring.

to the the report Coin Telegraph, Japan has taken a calculated but conservative approach to the global interest in issuing the official digital currency (CBDC). The governor of the Bank of Japan, Kuroda Haruhiko, said in a recent statement issued on Tuesday that the institution had not changed its position and still did not have a specific plan for issuing the national digital currency.

This lack of commitment does not mean impracticality in R&D in the official digital currency. In October 2020, the Bank of Japan pledged to begin the first phase of testing the concept of its official digital currency. Haruhiko has now confirmed that the test is scheduled to begin next spring.

The Governor of the Bank of Japan stressed that the report of the Bank for International Settlements (BIS) shows that 86% of the world’s central banks are examining the advantages and disadvantages of official digital currencies. Of these, 60% are currently in the testing or proof-of-concept phase. Haruhiko added:

Central banks agree that postponing the start of the review of official digital currencies until the need arises to issue them is not an appropriate policy response.

He also said:

In order to ensure the stability and efficiency of all payment and settlement systems, it is important for us to be fully prepared to respond to changing circumstances in an appropriate manner.

The governor of the Bank of Japan, noting the “dramatic changes” that are coming for the digital community, noted that the bank is taking the opportunity to carefully consider different approaches to potential changes in the central bank’s financing.

Haruhiko then grouped these emerging approaches under the heading of “Central Banking-as-a-Service.” Explaining further these trends, he argued that “as a service” is an emerging trend in finance that has been transferred from previous developments in the field of corporate and software to the present.

This means moving towards building business models that rely on customer-based service delivery, not adopting a traditional product-centric sales approach.

Haruhiko noted that “everything as a service” now includes phenomena such as “relocation as a service” (the purchase of relocation services).

According to Haruhiko, “infrastructure as a service” also falls into this category, which makes it even more redundant for companies to buy hardware. He concluded his speech in the context of finance as follows:

Recently, there has been a tendency to separate financial services, which were previously offered by financial institutions in a fully interconnected manner. As a result, it is possible to combine partial financial services with the services of non-financial corporations. From such a thing to “banking as a service” […] It is also known as intangible services.

Since the beginning of January 2020, the Bank of Japan has been closely monitoring public and private finance innovations, working with the International Settlement Bank and five other major global banks to investigate official digital currency and focus on supporting digital currency. Focuses on issues such as offline access.


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