The Bank of Japan (BOJ) has concluded that, having effectively completed the second phase of the digital yen pilot project, there is sufficient reason to continue the initiative.
The second phase of the state cryptocurrency ran from April 2022 to March 2023. According to the information, this phase was aimed at exploring technologies suitable for limiting the maximum number of digital yen a person can own.
Moreover, the experts analysed what dramatic changes would occur if people abandoned traditional banking services and switched to the digital yen. The second stage also looked at situations where one user has multiple accounts through intermediaries.
The test used a model with one hundred thousand hypothetical users and five intermediaries to measure throughput of up to three thousand transactions per second. They also looked at privacy and fraud prevention aspects.
In March this year, it was announced that Tokyo Kiraboshi Financial Group, Minna Bank and Shikoku Bank would join forces to test stablecoins on the Japan Open Chain blockchain. The first phase of testing is the issuance and transaction of coins between banks, while a later phase is expected to introduce stablecoins that meet all legal criteria.
Earlier, Haruhiko Kuroda, governor of the Bank of Japan, expressed the view that the Bank of Japan's digital currency should cooperate with other payment systems in an attempt to improve financial conditions in Japan.