September 20, 2020

U.S. and Japan propose to establish central bank digital currency

2 min read

There have been rumors for a long time that the People’s Bank of China and its affiliates are developing digital currencies, which are state-led virtual currency products based on blockchain technology.

However, these are only rumors that have not been officially confirmed, but even this has attracted the attention of the United States and Japan, which also want to build digital currencies.

The governor of the US Federal Reserve Bank has stated publicly that the Fed is currently conducting experiments on blockchain technology and digital currency. The Japanese politician also proposed that the Japanese government also construct a digital currency dominated by the Bank of Japan.

Similar to China, the United States has actually quietly started research on digital currencies, but before that, the US government and the Federal Reserve did not disclose relevant information.

The Fed President said the bank is currently conducting research and experiments related to the distributed ledger and its potential use cases for digital currencies, including central bank digital currencies.

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At the same time, the Fed President also revealed that he is cooperating with enterprises and institutions to conduct research to determine whether it is necessary to issue central bank digital currencies to establish new technical barriers.

Of course, in the short term, it is impossible for the United States to launch digital currencies, because the regulation, fraud, and anti-money laundering of digital currencies are issues that cannot be solved.

Previously, the Libra virtual currency project launched by Facebook was stranded because of strong opposition from regulators in various countries, and the Fed’s problem is no different from Facebook.

Japan’s Liberal Democratic Party politicians are currently preparing a new proposal after news of the Fed’s governor has been circulated in the media, which is expected to be submitted to the government next week.

The content of the proposal is that the Central Bank of Japan should also follow the Chinese and the United States to issue digital currencies, or the Japanese government and the United States should issue common digital currencies.

To this end, these politicians have suggested that Japan should establish its own digital currency to keep the financial sector innovative.

These politicians did not disclose more about Japanese digital currency, but it is expected that the Japanese government may discuss digital currency-related topics at the G7 summit.

Via: Bloomberg