Technology
The largest banks in Japan address the implementation of a digital payment system
Three of Japan's largest banks are among the major players in the development of a digital payment system for cryptocurrencies.
A study team on how the national digital payment solution is feasible, will be attended by the Mitsubishi UFj Financial Group (MUFG), the Mitzuho Financial Group and the Sumitomo Mitsui Financial Group – institutions which control more than 6.6 trillion dollars on assets between them.
DeCurret, the study group's host, said on Wednesday that members would "examine and discuss the challenges and solutions to digital currencies and digital infrastructure to find a consensus to achieve them."
The group will include large players from a range of sectors, apart from major banks. Telecom Giant KDDI Corporation, the largest traffic operator in the country, and Mori Hamada & Matsumoto, one of the Big Four's law firms , for example; as well as the EastJapan Railways Company.
As observatories, along with representatives of government departments, including finance, economics and home affairs, will participate on a regulatory level, both the Bank of Japan (BoJ), the Financial Services Agency (FSA). As observers.
The topics to be discussed include how a digital payment system is to work in Japan and abroad and potential applications. They will also discuss the provision of services and discussions on setting infrastructure standards.
Reuters, who reported the story, argued that a shared digital payment system between banks, big corporations, and regulators might harmonize and reorganize the current attempts to push Japan away from physical cash.
While 96% of the transactions are electronic in neighboring South Korea, Japan is aiming for 40% cashless transactions in 2025.
However, DeCurret's suggestions that the study group not only ween Japan from cash but also addresses existing concerns about cryptocurrencies. Although digital payments can boost productivity and convenience, the declaration reads, "There are concern about issues such as privacy, crime prevention and technical risks."
There may not be surprising concerns about cryptocurrencies' safety at all. Japan experienced two of the worst hacks ever – Mt. Gox and Coincheck. Exchanges now require an FSA license before they can legally operate in the country.
The licensed group from 2019 said that "the need for guidance for valuable digital currencies to be established in Japan" is the study group.
The group will meet once or twice monthly by September at its first meeting in June. The report would then post a review of the discussions.
