The Bank of Japan has stopped work on its own digital currency project due to a lack of public interest.
Like many other central banks in the world, the Japanese Central Bank (BoJ) has been conducting central bank digital currency (CBDC) potential research activities since 2021 to experimentally test the performance of the main functions and features of the CBDC retail ecosystem. The second phase of testing began in April 2022, but even then the Bank of Japan did not consider the possibility of introducing a digital yen in the short term.
Based on the results of testing, the Central Bank of Japan came to the conclusion that the citizens of the country have almost universal access to the banking system, so the issue of expanding access to financial services is not important from a political or economic point of view. And the widespread use of digital and mobile technologies in paying for goods and services casts doubt on the need to develop alternative forms of payment that are not popular.
The public also found the use of CBDCs unattractive. In particular, existing payment tools provide tangible benefits, such as points that can be earned from using payment services, which can be accumulated and used for subsequent purchases.
As a result, the Bank of Japan explained the abandonment of the digital yen creation program by the lack of interest on the part of citizens.
Earlier, the leadership of the Central Bank of Japan has repeatedly stated that the regulator will carefully and gradually test the digital yen, and is not going to conduct large-scale pilot projects, as China is doing.
Source: Bits
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