Japan has moved up a gear. Yamamoto’s commentary on Libra comes at a time when other lawmakers in the country echo his concerns. Japan is unlikely to issue digital currency soon due to technical and legal issues. But ongoing efforts highlight Tokyo’s pressure on China and Facebook’s progress in digital currencies.
Among the major central banks, China’s is the first to want to create its own digital currency.
But details of its project are still scarce. Many senior officials believe that if China’s digital currency is not controlled, it will advance the country’s digital hegemony on the world stage. It could also use to dethrone the dollar as the world’s leading currency.
The spread of digital currencies could undermine the supremacy of the dollar. But it could help stabilize emerging markets like Cambodia, which is highly dependent on the dollar. However, Japan remains somewhat optimistic about the possibility for each country to avoid future crises in their economy. Mr. Yamamoto said:
If each country manages to control monetary flows with its own digital currencies, this could avoid a big wave at a time of crisis and stabilize its own economy.