Japanese Official Advocate Creation of Digital Yen to Counter China
Kozo Yamamoto, head of the banking and finance systems research commission at Japan’s Liberal Democratic Party, is the second Japanese legislator to voice for the quick creation of digital yen. Yamamoto advocates creation of digital yen in the next two to three years.
Yamamoto stated that a strategy for the creation of central bank digital currency (CBDC) should be a part of the government’s biannual policy outline.
He elaborated that digital currencies could quickly make way in emerging economies and assist China, which is on the verge of launching its CBDC, gain further lead in digital domination.
Based on the aforesaid reasons, Yamamoto wants speedy development of the digital yen.
“The sooner the better. We’ll draft proposals to be included in government’s policy guidelines, and hopefully make it happen in two-to-three years. […] If each country manages to control flows of money with their own (digital) currencies, that could prevent a big swing at a time of crisis and stabilize their own economy.”
The legislator’s view succeeds that of ex-economy minister and ruling party member Akira Amari, who stated that he wants to roll out a CBDC to negate China’s upcoming digital yuan.
Yamamoto acknowledged that while an increase in the use of CBDC may weaken the dollar’s dominance, it could considerably remove volatility from emerging markets, which are dependent on the dollar, Cambodia, for instance.
Japanese legislators have recently suggested their government to take initiative in placing digital currencies in G7’s plan of action in 2020.
Additionally, last month end, the deputy governor of the Bank of Japan has stated that the organization must prepare for the launch of CBDC in case there is considerable demand from the public in light of technical advancements.
In the meantime, news reports indicate that the central bank of China has finished the top-layer creation and joint trial of the digital yuan.