No Demand For A Central Cryptocurrency In Japan: Central Bank Governor

Aside from the news that the largest bank in Japan recently denied the claims of releasing a digital currency, the Bank of Japan (BOJ) Governor Haruhiko Kuroda is in the news now, stating that there is no demand for a central digital currency (CBDC) by the public in the country.

Kuroda had a speech at the symposium for the 35th anniversary of the Center for Financial Industry Information Systems on December 4, where he addressed the challenges posed by private global stablecoins as well as CBDCs. He also concluded that at present, there is no reason and no demand to issue a CBDC in Japan, stating:

“In Japan, the amount of cash outstanding is still increasing, and it does not seem that there is a demand for CBDC from the public at present. Nevertheless, the Bank of Japan has been conducting technical and legal research on this matter in order to stand ready when the need for CBDC 13 may arise in the future. The Bank also needs to study the impact of CBDCs on financial intermediation.”

Even though the central bank governor does not right now see a valid reason to issue its own digital currency, he admitted that “there is a wide variety of private digital money denominated in Japanese yen.” This is how the bank encourages the use of digital currencies and their improvement, aiming to make their features even closer to what is expected from a central bank issued cryptocurrency (CBDC).

When it comes to global stablecoins such as Facebook’s Libra, Kuroda did not say anything about no demand – and said that the bank would take a more cautious approach.

“Global stablecoins (GSCs), such as Libra, may offer convenient payment services to many users, if legal certainty and technical stability are ensured. However, users cannot continuously appreciate the benefits of GSCs unless various challenges and risks related to money-laundering, cyber-security, data protection, and consumer and investor protection are properly addressed,” he noted.

While Kuroda is the cryptonews today saying that there is no demand about a CBDC in Japan, countries all over the world are increasingly researching their public and private digital currencies and stablecoins.