According to the central bank, the first process of Japan’s CBDC pilots will be finished by March 2022.
According to an official statement on Monday, the Japanese central bank has released a proof of concept for its central bank digital currency, or CBDC.
Following tentative plans for evaluating the technological viability of core CBDC functions and functionality in early 2021, the Bank of Japan has started CBDC testing in its first phase today. During this process, the bank proposes to create a test environment for the CBDC system and run tests on simple CBDC functions such as payment, issuance, delivery, and redemption.
This process is scheduled to be finished by March 2022, according to the announcement.
The BoJ initially claimed that CBDC testing will begin in October 2021. Although the bank stated that it “has no plans to issue CBDC” in order to insure the overall reliability and functionality of the payment and settlement processes, it is also necessary to plan for “changes in circumstances in an acceptable manner.”
According to the initial CBDC trial roadmap, the bank plans to launch a pilot CBDC initiative involving payment service providers and end users after the second phase of testing is completed. This section will assess the viability of additional CBDC functions in the test environment generated in the first phase.
The Bank of Japan recently announced the formation of the Liaison and Coordination Committee, which will work with both the public and private sectors on the forthcoming CBDC pilots.
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