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Japan’s Central Bank Head Discusses Bitcoin and Digital Currency

Japan’s Central Bank Head Discusses Bitcoin and Digital Currency

Japan’s Central Bank Head Discusses Bitcoin and Digital Currency

Bitcoin has had a very interesting relationship with Japan over its short and very public history. From the rise and fall of Mt. Gox, to the rise again of Bitcoin demand, and the consumption of Bitcoin by the culture (almost 50% of BitConnect’s traffic comes from Japan,) Bitcoin is a big deal in Japan, and this seems to be growing.

Hiroshi Nakaso, the Deputy Governor of the Bank of Japan addressed the rise of digital currency, led by Bitcoin, and DLT, or distributed ledger technology, or blockchain technology, last week for “Fintech and the future of Money” conference last week at the University of Tokyo. Here is a review of the Bitcoin related highlights.

Funny how there was no such thing as “FinTech” before Bitcoin

Virtually every nation, bank and major corporation are discussing how to incorporate blockchain technology into their business models, and the Bank of Japan is no exception. Also creating a digital currency, in conjunction, has at least been discussed. Nakaso-san has not seen Bitcoin make enough of an impact to change the way Japan’s monetary policy, which contradicts the regulations began in May, but it seems he is holding Bitcoin to a standard of actually threatening the Yen.

“What happens if virtual currencies such as bitcoin reach a significant circulation?” said Nakaso in his report. “Indeed, if virtual currencies such as bitcoin are to be widely used to purchase goods and services directly, there should, of course, be influences on monetary policy. At present, however, the consensus view in various international forums is that virtual currencies are unlikely to overwhelm sovereign currencies.”

He mentioned “trust” in the current bank-run economic system being a prime factor in the value of sovereign currencies. Yet, many nations are seeing that trust being eroded by negative interest rates, bans on cash, and endless money printing to hide poor economic policy. Younger people are using, and trusting, banks less and value the Internet more for their information and finances.

Mr. Nakaso felt the need to address Japan making a national digital currency in Bitcoin’s image. He could not dismiss the notion but seemed more positive on the use of blockchain technology.

“The Bank of Japan has no specific plan at present to issue digital currencies as a substitute for banknotes. Nonetheless, the Bank will make utmost efforts to deeply understand new technologies including blockchain and DLT. The Bank will also continue to conduct various research and analyses of these new technologies while seeking the possibility of improving its own infrastructure through applying them in future.”

In regards to actually making a Bitcoin-like currency, which other nations are already well on their way to producing, how that would work has certainly been discussed back at the bank.

“The issue of central bank digital currency raises diverse topics that are attracting attention from academics. For example, to whom should the central bank provide its account, as technological innovation changes the financial structure and the list of financial service providers? To what extent should the central bank provide "finality" to economic society? How should the information linked to payment transactions be handled?”

Creating and legislating a new digital currency and blockchain for a small African nation, or two, may be one thing, but doing the same for an economy the size and scope of Japan is quite another. The report filed by Nakaso-san does show that this is an active topic of conversation within the highest circles of Japanese banking. I’d say Bitcoin has made its impact, if not reaching competing levels of national adoption, yet.

Japan made news in May of this year with their national, and public, acceptance of Bitcoin as a currency on par with paper currency or their own Yen, according to the Japan Times. Since that time, Bitcoin related business has picked up in the region, with new partnerships in Japan helping people pay things like utility bills directly with Bitcoin. Also starting this month, there have also been new Japanese television shows built around promoting the Bitcoin concept to the mainstream.

Author : Evander Smart

Evander Smart worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inside. His travels, experience and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the shackles of economic slavery being created by global establishment forces. Evander gets you thinking about what money really is, and how it will work for you going forward. The world of finance is getting ready for incredible changes, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Video University

Digital Currency Japan FinTech blockchain technology bitcoin japan japan