A group of Japanese lawmakers is suggesting the country issue a digital currency and raise this issue in the upcoming G7 summit.
Reported by Reuters on Friday, all the lawmakers are from the Liberal Democratic Party (LDP), the current political party in power, and is led by Akira Amari, a former economy minister.
The group will submit its formal proposal to the government next week.
The group is also proposing the Japanese central bank to collaborate with its United States counterpart to share information and conduct technical studies on digital currencies.
The report outlined that the lawmakers are concerned with China’s development in the field of central bank digital currency (CBDC) and launching a digital version of yuan.
“We live in a stable world led by dollar settlement. How should we respond if such a foundation collapses and if [China’s move] gives rise to a struggle for currency supremacy?” Amari said.
“Japan should work in close coordination with the United States…As part of such efforts, we should ask the United States to set [digital currency] on G7 agenda as chair.”
Though Japan was in the backfoot in the arena of a digital currency for a long time due to technical and legal hurdles, the situation is now changing.
Central banks banking for digital currency
The Bank of Japan is leading a group of other top central banks, including its counterpart in England, eurozone, Canada, Switzerland, and Sweden, to study the feasibility of issuing a digital currency. The first meeting of the group has been scheduled for April.
Facebook’s attempt to launch Libra also raised the alarms of the central banks about the privatization of the monetary system and is pushing them to see the possibility of launching a centralized digital currency.
Meanwhile, the governor of the United States Federal Reserve recently revealed that it is also looking at the prospect of launching a digital version of the US dollar.