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Bank of Japan to begin central bank digital currency experiments later this year

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The Bank of Japan (BOJ) will start experiments on a central bank digital currency (CBDC) this spring, according to central bank governor Haruhiko Kuroda.

Reuters reported today that Kuroda said the bank must "prepare thoroughly" to issue a CBDC. That includes experimenting with how it would operate a digital yen during the course of this year.

At a webinar with The Block in July of 2020, a senior researcher at Nomura Research Institute said the BoJ had no concrete plans to issue a CBDC. That's still true, according to Kuroda, but he said that shouldn't stop the central bank from experimenting with how such a rollout might take place.

Deputy governor Masayoshi Amamiya made similar comments in January of last year, saying the BoJ must be prepared to respond since "public demand for CBDCs could soar in Japan." 

The BoJ has been researching CBDCs since at least 2019, according to an announcement from Kuroda in November of that year. 

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