Central bank digital currencies (CDBC for its acronym in English), have been developing little by little in several countries of the world. Some with more success than others, but certainly there are more and more projects that contemplate it. In that sense, the first phase of the pilot projects of the CBDC of Japan will have been completed in March 2022, according to the central bank.
What does this first phase of development of the Bank of Japan CBDC mean?
This first phase would be destined for a proof of concept, according to the official announcement of the Bank of Japan. It is recognized as the first phase of the project, as only basic features and functions have been tested for technical feasibility. During this phase, the bank plans to develop a test environment for the CBDC system and conduct experiments on the basic functions related to the payment, issuance, distribution and repayment of a CBDC.
According to the announcement, this phase is expected to be completed in March 2022. The original plan was to start testing in October 2021, but they advanced the process.
Under this CBDC’s original plan, the bank expects to start a CBDC pilot program involving payment service providers and end users after the second phase of testing is complete. In this phase, other CBDC functions will be implemented in the test environment developed in the first phase and their feasibility will be determined.
By when could we see this central bank digital currency?
The Bank of Japan stressed that, although it does not plan to issue a CBDC, it is still important to prepare for changes in circumstances appropriately. One step further, as they say over there. They have not yet planned it because they consider that they cannot yet guarantee the stability and efficiency of the payment and settlement systems in general.