Japan’s three megabanks to be part of study group to discuss virtual currencies

The study group organised by DeCurret will formulate a collaborative strategy to promote cashless transactions in the country

Japan’s leading cryptocurrency exchange platform, DeCurret, is collaborating with the three megabanks of the country in a new study group formulated to look into a common settlement infrastructure to facilitate digital payments in Japan. The initiative, backed by Japan’s central government and its financial regulator, aims to promote cashless transactions to improve efficiency and ensure safety amid the COVID-19 pandemic.

The study group includes top banks of the country, such as the Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group, as well as East Japan Railway and several other non-financial firms. The group is expected to meet twice a month from June through to September this year, with observers from Bank of Japan, the Ministry of Finance and the Financial Services Agency attending.

Unlike China where one or two digital payment systems dominate the market, Japan has a wide range of digital payments services competing with one another. “Japan has numerous platforms for cashless settlement, but they have yet to overwhelm the usage of cash,” Hiromi Yamaoka, a former central bank executive who will chair the group, said in an online briefing according to The New York Times.  Thus, it is important to enhance the inter-operability of digital currencies and infrastructure, Yamaoka reckoned.

DeCurret in a press release yesterday stated that the purpose of the group is to “examine and discuss challenges and solutions concerning digital currencies and digital settlement infrastructure…”

The study group is looking towards discussing case studies of digital settlement and digital currencies in Japan and abroad. It also aims to understand the impact and future potential of the application of new digital infrastructure.

Another area of research involves potential usage areas of digital currency settlements and their impact and vision.  Further, the group will consider issues to be addressed for the realisation of digital currency settlements, including the scope of service provision, consideration for its usage value, roles of providers and concerned parties and standardisation.

The press release also stated that the collaboration is intended to result in the publication of a report summarising discussions at the study group among other benefits.

Nikkei Asian Review has further revealed that the early focus of the group is to link their digital currencies to East Japan Railway’s popular Suica smart transit card, in order to expand their customer bases by improving convenience.

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