Category Archives: Bank of Japan

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World’s Fifth Largest Bank Joins Crypto Space with Digital Yen

Japan’s Mitsibushi UFC Financial group (MUFG), the world’s fifth-largest bank by assets, has announced it will trial its own digital currency as early as 2019, reports Cointelegraph.

The move, which dates back as far as 2016, sees the Japanese giant running out the coin, valued at one yen, to 100,000 account holders, according to Japanese broadcaster NHK.  The bank suggests that its MUFG coin will be usable in a number of retail outlets, bars, and restaurants, and will also be transferable to other participant’s accounts.

MUFG will be checking to see that it’s all working as intended and that settlements are carried out smoothly and securely. It is reportedly broadening the pilot by offering the currency to a variety of businesses in order to expand the test.

Japan has seen increased interest in digital currency from some of the country’s largest cooperations, with DMM’s announcement that it was ready to trade in cryptocurrency and, most significantly, Yahoo Japan’s announced 40% stake in BitARG, planned for later this year. The deal, worth between USD 18.5 million and USD 27.8 million, allows BitARG to operate a domestic trading platform under FSA rules, making it a viable investment opportunity for Yahoo.

The Japanese Central Bank continues to be wary of cryptocurrency, with numerous warnings issued to customers regarding the perils of dabbling in digital currency, even issuing a negative Q and A for customers earlier in the year in order to test public knowledge and warn about the risks of crime.

Also Japan-based global investment bank Nomura has just announced its latest project; to establish a custody offering for digital assets.  The new project aims at removing barriers to institutional cryptocurrency investment.

Although news regarding large banks like MUFG and companies such as Yahoo walking the crypto path serves to give some extra legitimacy to the Japanese cryptocurrency market, there are still those who feel the ethos of the industry has been somewhat altered. Many crypto enthusiasts feel that the creation of Bitcoin was a positive step towards bypassing the monopoly of institution banking after the financial turmoil of 2008.

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Bank of Japan Has No Plans for Central Bank Crypto

The Bank of Japan (BoJ) has stated that it had no plans to issue to issue a central-bank digital currency (CBDC).

At a recent conference between the International Monetary Fund (IMF) and Japan’s Financial Services Agency on Monday the BoJ’s deputy governor Masayoshi Amamiya suggested that a CBDC could undermine the bank’s two-tier system and destabilize it.

Amamiya suggested, “…the issuance of central bank digital currencies for general use would be analogous to directly allowing households and firms to have accounts in the central bank.”

The current system at the BoJ only allows access to private banks and other limited financial bodies.

Recent comments by the bank have been cool towards cryptocurrencies, despite the popularity in the country. Cryptocurrency crime has dampened JoC enthusiasm, so much so that the bank has recently surveyed its customers to get their point of view on digital currencies.

The one-page survey entitled ‘Let’s think about cryptocurrencies!‘ has appeared on a financial education site run by the bank. It asks such questions as “should cryptocurrencies be considered as money?” and whether you could profit from them and if is it likely they would be stolen. The survey gives the public a basic overview of digital currency but points out that there is no central bank to back them up.

The bank, despite its “wait and see” stance, has started to consider the viability of cryptocurrency’s underlying blockchain technology for business applications. The bank’s Project Stella initiative has conducted research on how distributed ledger technology can create new securities settlement systems.

Outside of the banking system, cryptocurrency continues to flourish in Japan. China and India’s attempts to outlaw the new technology have not been duplicated in Japan. Firm public and business support have made Japan a cryptocurrency haven, with a rise in domestic firms adopting cryptocurrency or blockchain technology within the country.

Figures released recently showed that 3.5 million Japanese are now trading in cryptocurrency as the government continues to work towards full legalization and regulation of ICOs.

 

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