Japan's Digital Yen Pilot Program: Launching in 2023 and Beyond

Japan is accelerating its efforts to develop a central bank digital currency (CBDC), the digital yen. Japan will launch a pilot programme in April to test the use of its version of the central bank digital currency (CBDC) known as the digital yen, its central bank said. The highly anticipated digital yen pilot is a significant step towards understanding the potential of CBDCs in a modern economy.

The Bank of Japan (BOJ) has been piloting programs for two years, trying to arrive at a decision of whether it should issue its own CBDC. Back in February, it was announced that this development would continue, with increased focus on practical applications.

This isn't just a theoretical exercise. Scheduled to launch in 2025, the digital yen pilot will include private banks and other organisations with the goal to identify use cases for customer deposits. This collaboration aims to simulate real-world transactions and assess the digital yen's viability for everyday use.

Japan will start a pilot programme in April to test the use of a digital yen, its central bank said on Friday, joining a growing number of countries seeking to catch up with countries already exploring CBDCs. The initial phase will focus on technical feasibility and system design, paving the way for broader adoption in the future.

Stay tuned for updates on the digital yen pilot program as Japan continues its journey towards a digital future.