A group of Japanese lawmakers has started working on a proposal for Japan to issue its own digital currency over concerns surrounding Facebook’s Libra and China’s upcoming digital yuan.
According to Reuters the cryptocurrency, a digital equivalent of the yen, would be a joint initiative between the country’s government and private companies to put Japan “in tune with global changes in financial technology.” Speaking to the news agency Norihiro Nakayama, parliamentary vice minister for foreign affairs, stated:
The first step would be to look into the idea of issuing a digital yen… China is moving toward issuing digital yuan, so we’d like to propose measures to counter such attempts.
The group of lawmakers, comprised of about 70 Liberal Democratic Party members, is led by former economy minister Akira Amari, and plans to submit a proposal to the government as early as next month.
Reuters notes that Japan is unlikely to issue its own digital currency any time soon as there are technical and legal barriers to overcome, although the move comes as the Bank of Japan, the country’s central bank, joined six other central banks to share expertise on creating digital currencies.
The report adds that Shinzo Abe, the country’s Prime Minister, recently told parliament the government will work with the Bank of Japan in studying digital currencies and “ways to enhance the yen’s convenience as a settlement means.” Some Japanese lawmakers, it says, voiced concerns over China’s move to expand the yuan’s influence as a settlement currency.
A former board member of Japan’s central bank, Takahide Kiuchi, was quoted as saying:
The BOJ probably won’t want to do anything that would stifle private-sector innovation. The best way could be to issue a hybrid-type digital currency that is operated and issued by private firms, with the central bank’s involvement.
Kiuchi noted he believes China and Japan have different motives to issue their own cryptocurrencies. While china ants to enhance the yuan’s influence, Japan would be trying to change its cash-loving culture.
Japan, it’s worth noting, has been accepting bitcoin as legal tender since April 2017, and is home to various prominent cryptocurrency businesses.
Featured image via Unsplash.