Japan steps up interest in CBDC, includes it in official economic plan

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Japan is getting serious with its plans to launch a central bank digital currency (CBDC). According to a new report, the country included considerations for a CBDC in its official economic plan.

While it may be late to the party, Japan is certainly moving faster than most other countries in its pursuit for a digital yen. The East Asian country has been collaborating with other countries in recent months in CBDC research. It has also been publishing some of its findings on the opportunities and risks associated with launching a CBDC.

In its latest leap, the Japanese government has now included considerations for a CBDC in its official economic plan. As per a report by the country’s largest newspaper Nikkei, Japan is set to include the consideration in its economic and fiscal policy blueprint, known as the Honebuto Plan.

Such an inclusion would make the CBDC an official government policy, the paper claims. Following the inclusion, the Cabinet would then be responsible for deciding whether or not to move forward with the plans.

The report further claims that the Bank of Japan has been collaborating with the European Central Bank and other global central banks on its CBDC pursuit. It is set to launch a proof of concept, after which it will liaise with other countries on its findings.

The report offers yet more proof that Japan is stepping up its efforts in pursuit of a digital yen. The country has been one of the biggest digital currency markets in the world, showing that the people would be receptive to a digital yen. Japan also has arguably the most advanced digital currency regulatory framework of all the big economies. It was also the first country to recognize digital currencies as legal tender, spurring the rise of a huge digital currency community.

As CoinGeek reported recently, the Bank of Japan recently published a report on the offline usage of a CBDC. The regulator delved into a number of methods which could avail the CBDC in an offline setting, seeking to cater to universal access and resilience, the two biggest features for digital currencies.

As with many other countries, Japan’s efforts are partly due to the great leaps made by China in its development of a digital yuan. Japan had downplayed the demand for a CBDC as recently as last year. However, with China seemingly in the last stages of its CBDC development, Japan has had to play catchup or risk lagging behind its Asian neighbor in the digital payments era.