Former Bank of Japan exec says Japan will need years to issue digital yen

Former Bank of Japan exec says Japan will need years to issue digital yen


Hiromi Yamaoka, former head of the payment and settlement systems department at the Bank of Japan, said that the country will likely need several years before it can issue a central bank digital currency.

In a Nov. 17 Reuters interview, Yamaoka explained that the BoJ is concerned about a CBDC potentially triggering massive outflows from private bank deposits.

Yamaoka, who now chairs a group of banks looking at building a common settlement infrastructure for digital payments, argued that there is “no point issuing a CBDC if it isn’t used widely,” stating:

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“The fundamental question, and a very tricky one, is how to ensure private deposits and a CBDC co-exist. You don’t want money rushing out of private deposits. On the other hand, there’s no point issuing a CBDC if it isn’t used widely.”

In order to mitigate the risks of CBDC-fueled private deposit outflows, the BoJ could consider putting limits on CBDC holdings by a single entity,

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