A panel in which Japan's three megabanks are participating have been examining the effects of cryptocurrencies and the challenges of implementing them, with plans for large-scale experimentation in fiscal 2021.
More than 30 companies and organizations, including NTT Group, East Japan Railway Co., Seven & i Holdings Co. and Kansai Electric Power Co., are considering joining the experiments. They will be divided into more than 10 groups such as retailers, electric power companies and insurance firms, and will start tests aiming to put cryptocurrencies to practical use for each respective group in and after fiscal 2022.
The retailers' group, for instance, plans to hold an experiment where transport companies and suppliers fees' are paid with digital currency. Payments between these companies are usually made at the end of the month, creating a time lag between deliveries and payments. The retailers plan to build a system in which digital currencies are used to issue payments immediately upon delivery of goods or products. Such systems can also reduce the hassle of cash management or making bank transfers.
The digital currencies used in the experiments will be designed by IT company DeCurret Inc., using blockchain technology, which makes data practically immutable and tamper-proof. Banks will be in charge of issuing and managing digital currencies.
Several digital currencies will be used in the experiments, but under a unified basic framework enabling them to be exchanged with one another.
The panel was launched in June to discuss challenges and solutions in the field of digital currencies. The experiments to be conducted in Japan are exceptionally large in terms of, for example, the number of participating companies.
Overseas, the public and private sectors are accelerating moves to issue digital currencies.
Facebook Inc. is preparing to launch the Libra digital currency and China began large-scale demonstration tests of its own digital currency, the digital renminbi, last month.
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