Skip to content

Japan’s largest banks to start testing digital currency payments in coming months

Japan's largest banks to start testing digital currency payments in coming months

Several leading Japanese banks, including MUFG, SMBC, Mizuho, and Japan Post are joining other domestic organizations to venture into the cryptocurrency space with plans to enable blockchain payments through a digital currency. 

According to a White Paper published on November 24 by the organizations under the Digital Currency Forum, a consortium of 74 entities, the payment system will be a two-tier platform deploying a permissioned blockchain.

The currency’s provisional name is Digital Currency JPY (DCJPY). The DCJPY will use the blockchain distributed ledger technology and be backed by bank deposits. Users will make transactions in digital currency once they open an account.

The project which has passed the Proof-of-Concept (POC) phase was initiated by the DeCurret startup. The firm attracted a $62 million investment led by SMBC, MUFG, and SBI banks, which are also part of the consortium. 

The project has also attracted government agencies, including ​the Financial Services Agency, the Ministry of Finance, and the central bank that will act as observers. 

Commercial phase set for 2023

Among the lined up use cases will be to deploy the digital currency in supply chain systems with a planned rollout in 2023 targeting retail companies and their partners, according to November’s progress report. In this line, the consortium plans to carry out a PoC seeking to automate payment processing to enhance efficiency.

Additionally, the firms are planning to integrate the DCJPY with other digital platforms after the test run. The test run will explore the digital currency’s feasibility for low-cost business transactions.

“The Digital Currency Forum also envisions that digital currency, DCJPY will be able to connect organically with other digital platforms. In other words, the forum aims to realize a form of “Digital Payments as a Service” in which various economic activities and businesses can add payment and settlement functions,” the whitepaper states.  

Users will request DCJPY, then withdraw money from their bank account and offer the tokenized cash. However, users can only transfer DCJPY to other account holders at the same bank for the initial stage.

Furthermore, other consortium groups are looking for additional use cases like electric power P2P trading, security tokens, retail payments, industrial settlements, regional coins, and NFTs.

Additionally, it’s not clear how the DCJPY rollout will impact ongoing efforts by the Bank of Japan to explore a CBDC. Notably, some Bank of Japan officials have previously indicated that they would work with the private sector to develop the CBDC.


Best Crypto Exchange for Intermediate Traders and Investors

  • Invest in 70+ cryptocurrencies and 3,000+ other assets including stocks and precious metals.

  • 0% commission on stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit

  • Copy top-performing traders in real time, automatically.

  • eToro USA is registered with FINRA for securities trading.

30+ million Users
eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk. eToro USA LLC does not offer CFDs, only real Crypto assets available. Don’t invest unless you’re prepared to lose all the money you invest.

Read Next:

Weekly Finance Digest

By subscribing you agree with Finbold T&C’s & Privacy Policy

Related posts

Disclaimer: The information on this website is for general informational and educational purposes only and does not constitute financial, legal, tax, or investment advice. This site does not make any financial promotions, and all content is strictly informational. By using this site, you agree to our full disclaimer and terms of use. For more information, please read our complete Global Disclaimer.