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Bank of Japan is conducting research on digital currency

Digital CurrencyBank of Japan Governor Haruhiko Kuroda said the central bank has no plans now to issue digital currencies but is conducting research in case the need to do so heightens in the future, news agency Reuters reported on Tuesday. He also said stable coins should not be issued unless there is a sufficient framework in place to ensure governance and risk management.

“If stable coins backed by companies with a huge customer base are issued globally, that could have an impact on monetary policy and financial system stability,” Kuroda told parliament, the report added.

Other Asian nations are also bracing for blockchain-based currencies. China is preparing to launch its own cryptocurrency. Earlier this month, there were reports that the country has been taking steps to ensure that there are no negative posts or articles around cryptocurrencies or blockchain technology. China’s move to roll out a digitized domestic currency is being closely watched by financial industries across the globe, though few details are currently available. The officially-named Digital Currency Electronic Payment will be powered partially by blockchain technology and dispersed through digital wallets.

Meanwhile, the Indian government had said in July that it wants to criminalise all commercial dealings in private cryptocurrencies but it would encourage blockchain technology. But an inter-ministerial committee set up by the government to study the ecosystem, had admitted that the distributed-ledger technology (DLT) can have positive effects if deployed in financial services and suggested that India must consider introducing an official virtual currency to replace private cryptocurrencies.

At present, trading in cryptocurrency is illegal in India. In July last year, the country’s central bank had imposed a banking ban on entities dealing with the cryptocurrencies, following which the entire ecosystem had collapsed with several big players such as Zebpay, Koinex and others closing down operations. India’s apex court is hearing the matter on whether cryptocurrencies such as Bitcoin, Ethereum and Litecoin among hundred others are legal and if they should be regulated, for over two years now.

On the other hand, North Korea is in the early stages of developing its own cryptocurrency, a representative for the regime had told VICE News in September. The move is in a bid to avoid international sanctions and circumvent the US-dominated global financial system, the report added. The digital currency, which is yet to be named, will be “more like bitcoin or other cryptocurrencies,” Alejandro Cao de Benos, the official in charge of North Korea’s cryptocurrency conferences and a special delegate for the Committee for Cultural Relations for the Democratic People’s Republic of Korea, had told Vice News.

Several countries have either banned digital currencies altogether or have placed various legal impositions on this asset class. A few G-7 members including the United Kingdom and the United States, along with Australia and Singapore are taking a cautious approach and are reportedly in the process of creating a regulatory system. Meanwhile, some countries such as Switzerland have accepted crypto as a new asset class. The nation provides special financial impetus such as low tax rates, tax exemptions to crypto startups looking to set up their operations.

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