January 23, 2022

Japan tests national cryptocurrency - digital yen

Japan tests national cryptocurrency - digital yen

The Bank of Japan will conduct testing of the national digital currency in order to study the technical validity of the release of such an instrument.

About the interest in creating proof of conceptdigital yen regulator announced for the first time. The launch dates for this project are unknown. It is also unclear how far the Bank of Japan will advance in its research regarding the People's Bank of China, which has already completed the technical training of the digital renminbi and is now involved in legal aspects.

In the report under the heading “Technical Problemscentral bank digital currencies (CBDC) ”, the Japanese regulator intends to start“ assessing the viability of the CBDC from a technical perspective, collaborate with other central banks and relevant institutions, and consider issuing a CBDC. ”

The first phase of testing will be devoted to evaluationtechnical feasibility of launching a coin. BoJ considers the reliability of such an instrument and its availability to the public. Also, the report provided by the bank indicates 2018 Nikkei research data, which says that only 65% ​​of the country's residents have smartphones.

In addition to protecting digital currency, the agency also plans to study the issue of its availability in emergency situations. The tool should work even in the absence of electricity.

During testing digital currency BoJplans to cooperate with the Central Bank of other countries. The agency still does not have an unambiguous decision on the use of blockchain, referring to the insufficient bandwidth of decentralized networks.

“Both centralized anddecentralized systems. When we talk about large volumes of transactions in retail sales in developed countries, it is better to choose a centralized technology. In a situation where the volume of transactions is limited and reliability is a top priority, it is worth considering the decentralized type ”, - is written in the report.

Recall that China has accelerated the development of its digital currency after the introduction of US sanctions, as well as because of the pandemic.

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