Bank of Japan Initiates Its CBDC Pilot Trials’ First Phase

The Bank of Japan (BOJ) has again launched a trial program after freezing the central bank digital currency (CBDC) developments several months ago due to very low demand. The Bank of Japan (BOJ) has now launched a trial program to analyze the technical implications of digital currency.

The Bank of Japan (BOJ) has officially started to conduct various test runs on a proof of concept and the viability of their central bank digital currency (CBDC). The first phase of these tests is already underway and is expected to be completed by the end of March 2022.

BOJ Inclined to Ensure the Possibility of CBDC

The Central Bank of Japan is now inclined towards introducing its own national digital currency. According to a recent coverage from Reuters, the test program of the digital currency will include two phases.

The initial steps of the trial program will be made till the end of March 2022. These trials will be focusing on the testing of the technical feasibility of how the BOJ will issue, redeem, and distribute a central bank digital currency (CBDC).

The Bank of Japan (BOJ) has stated that the institution will join forces with various central banks in the hopes of matching the innovation of this field of digital currency.

After some time, the central bank of Japan will move to the second phase of its trial program. This second phase will be more focused on very particular capabilities, for example, the option of setting a limit on the number of central bank digital currency (CBDC) that a single entity can control.

BOJ Is Not the Only Bank in This Race

Sinichi Uchida, the executive director of the Bank of Japan (BOJ), stated last month that the organization has come up with a fool-proof plan. He said that the bank would initiate a beta version of the program to test and analyze the payment service providers and the end-users if needed.

Many central banks all over the globe are trying to come up with their own digital currencies and are trying to reduce the usage of paper currency. China is one of the first countries who initiated the project of introducing the digital yuan.