In April 2023, Japan intends to launch a pilot program for a central bank digital currency (CBDC), even if the country does not allow the use of international stablecoins such as Tether (USDT). It intends to include commercial companies and pilot a CBDC ecosystem model.

The Bank of Japan (BoJ) released Shinichi Uchida’s opening remarks at a CBDC committee meeting on February 17. Uchida is the executive director of the BoJ. In it, Uchida announces that the Bank has chosen to start a pilot program for the “digital yen” in April after concluding its proof of concept, which began in 2021. This decision was made after the Bank completed its proof of concept in 2021.

During the pilot, research on the technological feasibility of the “digital yen” will continue, and the experiment will be expanded to include modeling of a CBDC ecosystem with the participation of commercial companies. According to the official, during the course of the pilot project, there will be no real retail transactions, just simulations of such transactions.

In his speech, Uchida focuses on the design of the future CBDC, as well as the need to consult with the business sector on alternative data models, architectures for offline payments, and other essential components of the system. To facilitate such discussions, the CBDC forum will be established.

Since the local media first announced the BoJ plan in November 2022, everyone was very excited to hear the news about the CBDC pilot project. The Bank of Japan will reportedly work with at least three Japanese megabanks, as well as regional banks.

Meanwhile, authorities in Japan are contemplating whether or not to repeal the restriction on foreign stablecoins that became law in 2022. The Japan Financial Services Agency estimates that the revisions will be ratified by the end of June 2023 at the latest. . . Although they will not automatically allow any foreign stablecoins to enter the market, they will give the go-ahead to those coins that can successfully pass individual tests.