The Bank of Japan (BoJ) is making preparations to conduct pilot testing for the digital version of the yen in 2019, despite the fact that it is unclear whether or not the central bank digital currency (CBDC) will be implemented. According to the reports, the Japanese central bank has been working closely with three megabanks and regional banks in order to carry out a CBDC issuance trial.
Beginning in the spring of 2023, the pilot program plans to begin providing demo tests in preparation for the introduction of Japan’s national digital currency, the digital yen. Experiments will likely take place over the next two years before a decision is made about whether or not to issue CBDC by 2026.
It is important to take note that the Bank of Japan carried out an internal trial throughout the course of the previous year in order to evaluate the fundamental functionalities required for the issue and circulation of digital money. The following program will serve as the last step of the trial, with an emphasis on its implementation in the real world.
As part of the experiment, the Bank of Japan will work in conjunction with major private banks and other organizations to identify and address any problems that may arise with regard to the deposits and withdrawals made by customers from their bank accounts.
During these tests, the offline capabilities of Digital Yen, which allow for payments to be made even when there is no internet connection, will also be evaluated. While Japan has not yet begun its CBDC trial, the New York Federal Reserve has issued a report on the first phase of their study into wCBDC, which is known as “Project Cedar.”
Compiled by Coinbold