Bank of Japan Releases CBDC Report and Launched Its Pilot Program As Other Countries Gain Steam
The Bank of Japan released the results and findings of a report on central bank digital currencies
Japan launched a pilot program in April, the bank said in its report on Monday.
“We have launched in April 2023 and are proceeding with the pilot program. In the pilot program, the end-to-end process flow will be tested, the measures and potential challenges for connection with external systems will be explored, and considerations and solutions indicated as necessary in the PoCs [proof of concept] will also be explored,” the bank said.
The bank started its first phase for the “proof of concept” in April 2021, and the second phase began a year later to evaluate new technologies and accounts provided by multiple intermediaries.
More and more countries are exploring the possibility of a CBDC, according to the Atlantic Council, which tracks CBDCs in 120 countries.
Eleven countries have launched a CBDC, including the Bahamas and Nigeria.
Meanwhile 18 countries are in pilot stages, including Japan, India and China, according to the Atlantic Council.
“In 2023, over 20 countries will take significant steps towards piloting a CBDC. Australia, Thailand, Brazil, India, South Korea and Russia intend to continue or begin pilot testing in 2023. The ECB [European Central Bank] is also likely to start a pilot next year,” the Atlantic Council said.
In the US
The future of a CBDC has mixed reactions among lawmakers.
Republican Rep. French Hill of Arkansas and Democratic Rep. Jake Auchincloss of Massachusetts introduced a bill this month, dubbed the Power of the Mint Act to block the Federal Reserve from issuing a CBDC.
Advocates say CBDCs can provide better financial services to their citizens, while critics say a CBDC is a breach of privacy.
Republicans Sen. Ted Cruz and Rep. Tom Emmer have also introduced bills to block the Federal Reserve from issuing a CBDC directly to individuals.
The Federal Reserve has said they have not made a decision on issuing a CBDC and Fed Chair Jerome Powell said the bank would need congressional approval.”