The Bank of Japan (BOJ) has not yet decided when it will launch its CBDC into the market. BOJ has stated that it would tackle CBDC in measured steps like Sweden’s strategy. It has stated that it would not be conducting large-scale pilot testing like China anytime soon.
Kazushige Kamiyama, the chief of the BOJ’s payment system section, stated in an interview:
“Sweden’s staged and planned expansion of experiments is a better fit for us than China’s big-scale tests from the get-go. The framework and design of the central bank digital currency needs to be decided as a part of an overall settlement system for the future.”
According to Kamiyama, BOJ intends to proceed with its study cautiously while assuring Digital Yen’s interoperability with other CBDCs. Furthermore, the Bank of Japan works closely with its peers such as the Federal Reserve and the European Central Bank.
Decision on the Digital Yen is expected by 2026
The Bank of Japan stated that it will engage closely with the public on all the decisions regarding the adoption of CBDC. According to BOJ Governor Haruhiko Kuroda, the decision to issue a CBDC would most likely be made by 2026.
However, based on recent events, the BOJ has already begun Phase II of its digital money tests this month. It will conduct a pilot test in the next phase. During the pilot test, the BOJ will also impose limits on the holdings and transactions of its CBDCs.
Kamiyama explained:
“Many private-sector businesses are calling for a limit to be set to avoid or at least contain any massive capital shift to a CBDC from bank notes or deposits.”
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