update 18 August 2021

Deputy Governor of BoJ Says Advanced Economies Don’t Need CBDCs

Recently, the Bank of Japan’s deputy governor claimed that advanced economies do not need central bank digital currencies (CBDCs).  He spoke at the Future of Payments Forum, organized by the Bank for International Settlement.

Amamiya said that CBDCs are a tremendous financial system for developing countries, especially the ones with immature payment infrastructures. Nevertheless, he claimed that advanced technologies cannot benefit from virtual currencies.

Why Amamiya is Against Digital Currencies

Amamiya said that it is unnecessary to implement new steps to ensure people have access to central bank money. He claimed that giant economies are operating safely and stably and does not encourage them to adopt new technologies.

The BoJ’s deputy governor also pointed out that if CBDCs operated at lower costs than private initiatives, merchants would go for the digital currencies. Nevertheless, he claims that it would suppress private business and discourage innovations.

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Additionally, Amamiya said if Japan introduces a digital yen, BoJ could become the sole repository for its whole transaction information. However, this raised concerns about how the central bank would store and protect consumers’ financial data.