Japan’s central bank has urged the G7 nations to establish a unified regulatory framework for digital currencies quickly.
There are seven countries in the G7: Canada, France, Germany, Italy, Japan, and the United Kingdom. The G7 is a political forum for world leaders to meet and exchange ideas.
Kazushige Kamiyama, chief of the BOJ’s payment systems department, told Reuters that stablecoins made it extremely simple to “establish an individual global settlement system.” This would enable countries to circumvent more established and regulated payment networks that settle transactions in the US dollar, euro, or yen.
Kamiyama emphasized that speed is essential if the G7 countries effectively coordinate their regulation of cryptocurrencies and digital assets. Current restrictions do not adequately account for their increasing popularity and global reach.
According to the source, the regulatory framework will influence the design of the digital yen, Japan’s central bank digital currency (CBDC). Individual privacy will have to be carefully balanced against fears of money laundering and other white-collar crimes.
CBDCs will not be introduced anytime soon, according to BOJ Governor Haruhiko Kuroda, who announced on Tuesday at Japan’s FIN/SUM fintech convention. First, he says, the BOJ intends to examine the impact of central bank money on Japanese society.
To preserve the stability and effectiveness of the overall payment and settlement system, we feel it is vital to plan for changes in conditions properly.
Kuroda’s comments came only four days after the Bank of Japan revealed that it had entered the second phase of its CBDC feasibility report. It is set to begin this month, so any new regulations imposed by the G7 will have an impact.