A group of Japanese lawmakers from the ruling party came forward with the proposal of Japan issuing its own digital currency.
It seems China’s determination to create the digital yuan and Facebook’s Libra has alarmed Tokyo more than a little bit. The digital yen would be created by the government working in partnership with private companies, which would help Japan be in tune with the global changes that are happening in financial technology at the moment, thinks Norihiro Nakayama, the foreign affairs parliamentary vice president, who also said on Thursday:
“The first step would be to look into the idea of issuing a digital yen. China is moving toward issuing digital yuan, so we’d like to propose measures to counter such attempts.”
The Proposal to be Submitted Next Month to the Government
The proposal is scheduled to be submitted next month to the government. While it’s unlikely for Japan to issue a digital currency as a result of both technical and legal impediments, the proposal comes while the Bank of Japan (BOJ) has made the decisions to conduct expertise on the matter, joining 6 other central banks that did the same.
Japan’s Government and BOJ Studying Digital Currencies
While political circles in Japan are paying more and more attention to digital currencies, Prime Minister Shinzo Abe took the word in parliament on Friday and said the government and the BOJ will work together to study digital currencies and to enhance the convenience of the yen as a means of settlement.
Facebook’s Libra and China’s Digital Yuan Had Central Banks on Fire
Facebook pushing forward to launch the Libra cryptocurrency had central banks looking more into issuing their own digital currencies. At the same time, China is working to have its own digitized money too, which has caused lawmakers in Japan to express their concerns.
The Finance Minister Taro Aso said at the beginning of this month that if the popularity of the digital yuan increases when it comes to it being a means for international settlement, Japan would have a “very serious problem” because it settles transactions in dollars mostly.
Takahide Kiuchi, a former board member at BOJ, thinks the two countries, Japan and China, would have to issue digital currencies for completely different reasons.