TOKYO, A senior central bank official said on Wednesday that the Bank of Japan (BOJ) will not introduce a digital yen to achieve negative interest rates, as some academics have suggested.
Executive Director Shinichi Uchida of the BOJ said in a speech that the BOJ will look into features like limiting the number of transactions and the amount of money each person or group can have in a central bank digital currency (CBDC).
Whether to make the digital yen an interest-bearing currency is also something the central bank is going to think about, but this may not be necessary because the CBDC could end up being a good replacement for bank deposits, he says.
“While the possibility of using such a functionality to achieve a negative interest rate is occasionally discussed in academia, the bank will not introduce CBDC on this basis,“ Uchida stated in a speech.
A digital yen hasn’t been decided on by the BOJ yet, but they have started a second phase of an experiment to get ready for the launch of a new one.
