In line with a recent report by ‘New York Times,’ while speaking in a recent meeting held at Nagoya, central Japan, the deputy governor of BOJ [Bank Of Japan] Masayoshi Amamiya expressed doubtsregardingthe employmentof CBDC, claiming that such digital currenciesareunlikelyto boostthe prevailingfinancial systems. Amamiyaadded that BOJis not planning toissue digital currencies.
The article reports that somemonetaryexpertsconsider CBDC as a tool for central banksto manage the economy once interest rates fall to zero.In line withthis theory, a CBDC wouldaltercentral banks to stimulate the economy by charginga lot ofinterest on deposits frompeopleandcompanies,which might successivelyinduce them topaymore cash.
Amamiya questioned the theory, claiming that charging interest on central banks-issued currencies wouldsolelywork if central banks eliminatefiat moneyfrom thefinancial system. Otherwise,the general public would continuechangingtheir digital currencies into the fiat currencies so as to avoid paying interest:
“In order for central banksto beatthe zeroboundaryon nominal interest rates,they’dfirst need togetrid of cashfrom the society.”
In turn, the elimination offiat moneyin Japan is “notan optionforusas acentral bank,” sincecashremainsa preferredmethodof paymentwithin thecountry, Amamiya claimed.
The BOJ deputy governor stressed that the bankisn’tdesigningmakinga CBDCwhich willbewideemployed bythe general publicfor settlement and paymentfunctions. The shift to bank-issued crypto fromthe prevailingsovereign currenciesis taken into account“quite a high hurdle,”whereascrypto assetsareusually related tospeculative investments anddon’trepresent a stablemeansof payment, he noted.
Earlier in April, Amamiya providedan analogoussceptical statement on CBDCs, claiming that a state-backed cryptomighthave a negative impact onthe prevailingfinancial system. However, at that time, Amamiya claimed that the bank was still eyeingrisingfintech like cryptowithin thefuture.
Even earlierthis week, a Japanese taxation policy committeehelda discussionaiming tofacilitate the crypto taxation filingprocess, with participantscalling to alleviatethe prevailinEgcomplicatedtax filing regime.
As reported by EtherDesk earlier on Oct. 17, Japan’s instant messaging freeware ‘LINE’ launchedtradingof its recently-developed LINK [LN] token on its native BITBOX cryptocurrency exchange.