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74 Japanese Banks Test Digital Currency

74 Japanese Banks Test Digital Currency

(24 November 2021 – Japan) A consortium of 74 Japanese firms - including the country's biggest banks - have set out plans to start testing a private sector digital yen in the coming months.

Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group are among the firms from a range of industries backing the tentatively named Digital Currency JPY (DCJPY) project, which has been in the works since last year.

The consortium has now released a progress report and a white paper.

The digital currency will be backed by bank deposits and use a shared platform to accelerate fund transfers and settlement between companies. While there will be a shared platform, a separate "business process area" will mean that the currency can be programmed to meet the different business needs of the participants.

Within the consortium, different groups are looking at a host of use cases such as the purchase of clean energy, retail payments, industrial settlements and NFTS, with proof-of-concept work set to begin soon ahead of a full launch in the near future.

The project will also "fit the CBDC that could be planned and implemented" by the central bank, said Toshihide Endo, who is advising project lead Decurret and used to head Japan's Financial Services Agency.

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