With 50 or so employees, Tokyo-based DeCurret is working on the design of the digital yen and coordinating the Digital Currency Forum (DCF). Run through for detail overview.
There are unique - and sometimes frustrating - features of Tokyo's metro system. Unlike most subway systems in the world, it is operated by several companies and a municipality branch, which means you have to buy different tickets for different lines.
Japan’s digital yen might look a lot like that.
With 50 or so employees, Tokyo-based DeCurret is working on the design of the digital yen and coordinating the Digital Currency Forum (DCF), a consortium of 74 of Japan's largest banks to roll out the digital currency. The digital yen will be issued by commercial banks as a liability on their books, much like conventional deposits, according to a white paper published in November.
Decurrent intends to create a platform that banks can use to issue the digital currency, and it also plans to issue the digital yen by the end of 2022, with trials starting as early as January.
In a country where the government is often sluggish but the private sector has a deep history of innovation, it is not surprising that entrepreneurs are stepping in to design a digital currency that will smooth corporate finance.
Developing a digital currency can be a challenging process.
Since its founding, DeCurret has been planning to launch a digital currency, but due to the regulation of stablecoins in Japan it started out with a crypto exchange business instead, Kuwata said. Adding to it he said, focusing on blockchain technology would help advance DeCurret's digital currency ambitions, regardless of the specific use case.
Despite being on the market for three years, Kuwata says the exchange has yet to earn a profit due to high competition. Exchanges that have been in the market for a while have observed a rise in trading volume and profits, he said. Nevertheless, this is "more about existing players that are increasing their volumes" than new entrants, so newcomers face a challenge, he said.
Crypto exchanges in Japan have struggled to turn a profit, and many struggles to stay compliant. Gains are taxed at up to 55% on some exchanges, pushing them overseas.