A group of over thirty Japanese companies will test the practical use case of a central bank digital currency in 2021, Reuters has learned.
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The group, including Japan’s three largest financial institutions with brokerages, telecommunication firms, utilities and retailers, will test the use of CBDC on a single settlement platform. Hiromi Yamaoka, a former Bank of Japan executive, says while Japan has numerous digital platforms, none of which "are big enough to beat cash payments."
"We do not want to create another silo-type platform. What we want to do is to create a framework that can make various platforms mutually compatible," Yamaoka added.
Although private financial institutions will be in charge of issuing CBDC in the experiments, the possibility of other entities issuing a digital yen will still be relevant, Yamaoka emphasized.
However, as iHodl earlier reported, Yamaoka thinks Japan will not launch its own digital currency within the next few months as there are still difficulties with the launch that are tied to the need for measures that would prevent huge outflows from financial institution deposits.
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