The deputy head of the Bank of Japan, Masayoshi Amamiya, ruled out the likelihood of issuing a national digital currency, Reuters reported.
According to the official, the issuance of such a means of payment would mean a waiver of fiat money.
“Liquidation of cash will make the payment infrastructure inconvenient for the population, so the central bank will not take this step ,” he stressed.
In addition, Amamiya is concerned that the release of a digital currency will result in a negative interest rate. As a result, the velocity of circulation of a monetary unit may slow down, since it will be beneficial for individuals and organizations to simply store a new payment unit. This development, the official is sure, will have a negative impact on business activity and financial stability in the country.
“Replacing private deposits with digital currencies of central banks can destroy the credit channels of commercial financial institutions, having a negative impact on the economy,” Amamiya said.
Recently Japan has changed the legislation, tightening the regulation of cryptocurrency.