According to the Japan’s central bank report, the first of several testing phases for its own CBDC is expected to begin in 2021.
The central bank of Japan (BoJ) has shared plans to conduct testing basic functions of central bank digital currencies (CBDCs) — issuance and distribution early in the fiscal year.
The experiments will show the way the BoJ can issue and work with general-purpose CBDCs, aimed to be used widely among both financial institutions and private entities.
Today, central banks of many countries are working actively on CBDCs. The People’s Bank of China is about to become the first bank to launch national digital currency. According to the Bank for International Standards’ report, CBDC was more searched than bitcoin in 2020.
The Japanese are among the most cash-using population in the world, and the government is trying to reduce this trend and instead promote cashless transactions amid the coronavirus pandemic. In the midst of the pandemic, people are more inclined towards using digital payment methods to avoid physical human contact.