The Bank of Japan said that next year it will start experimenting with how to run its own digital currency backed by the central bank.
The Bank of Japan will start experimenting with a CBDC
The Bank of Japan, in a study detailing its approach to CBDC, reported that it would conduct the first phase of experiments on core CBDC functions, such as issuance and delivery, early in the fiscal year beginning in April 2021.
The experiments will be part of the central bank’s efforts to explore more closely how it can issue general-purpose CBDCs, which are meant to be widely used by the general public, including businesses and households. Besides, the Bank of Japan aims to have financial institutions and other private organizations operate as intermediaries between the central bank and end-users, rather than making businesses and households make direct deposits with the BOJ.
Central banks across countries continue to experiment with CBDCs
Central banks have shown interest in CBDCs worldwide, and many are actively working on the same thing. China’s People’s Bank is all set to become the first big country to introduce its domestic digital currency. For the past five to six years, PBoC has been working on its national digital currency, known as DCEP, and is now very close to releasing it to the general public.