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BOJ to Experiment with Blockchain Settlement for Reserves
The Bank of Japan is testing blockchain to settle central bank reserves with financial institutions using tokenized deposits in a sandbox, expanding ongoing digital currency experiments.
- The BOJ rolled out a sandbox project to expand blockchain experimentation for settling central bank reserves, according to Governor Kazuo Ueda on Tuesday.
- The BOJ will conduct technical experiments on settlement using current account deposits on blockchain to explore connections with existing systems and interbank and securities settlement.
- The BOJ's CBDC timeline shows experiments began in 2021, and Japan launched a pilot in 2023; however, the BOJ has not committed to issuing a retail CBDC/digital yen.
- Analysts say the shift could enable instant, 24-hour settlement and reduce gridlock risk during stress events, following U.K. and Hong Kong precedents for on-chain sovereign issuance.
- This year the BOJ faces a decision on issuing a retail CBDC while Project Agoré, an international experiment involving central banks and private firms, tests tokenized deposits on blockchain.
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BOJ to experiment with blockchain settlement for reserves, Governor Ueda says
TOKYO, March 3 : The Bank of Japan will conduct experiments for using blockchain technology to settle deposits that financial institutions park with the central bank, Governor Kazuo Ueda said on Tuesday.The experiments will be part of a "sandbox project" under way at the BOJ to enable the use of central bank
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Read Full ArticleThe Japanese monetary authority is conducting experimental projects to integrate traditional finance with decentralized networks. Read more
The Bank of Japan wants to test the blockchain for payment transactions. The central bank hopes for efficiency gains. Source: BTC-ECHO BTC-ECHO
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