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Digital yen will focus in Simplicity in Design, BoJ Executive Says

G7 economies are rushing to ensure they are not left behind in developing a central bank digital currency (CBDC). Shinichi Uchida, an executive of the Bank of Japan, has stated that when Japan creates a CBDC, the foundation of the design will be simplicity.

Japan is still in the research phase of its CBDC development. It is lagging behind China, which has already deployed a CBDC for the testing phase.

Calls for Moderation in CBDC Development

While giving a speech on Friday, Uchida also called for guidelines that will moderate CBDC development. He stated that measures need to be enforced to ensure that once CBDCs are released to the public, they can co-exist with the traditional payment systems.

Uchida also advocated for the co-existence of the digital yen within the private sector payment system. He stated that the vertical integration of a digital yen in the private sector payment system would depend on the simplicity of the CBDC design.

Uchida further noted that one of the factors that will guarantee this simplicity is the creation of a single infrastructure that will accept payments made in both CBDCs and electronic payment systems. This will make it easy for users to switch from one channel to the next.

Uchida also noted that vertical integration in the CBDC design would enable the private sector to adopt the CBDC and create valuable services for both parties.

Japan’s Progress in Development

The Bank of Japan has already commenced the proof of concept study regarding a CBDC. The second phase of the digital yen development is expected to start during the second quarter of 2022.

The Asia Pacific region has made the most substantial progress in CBDC development. Japan will join the growing list of nations in the region looking into CBDCs, especially with China’s advancement in the field.

Earlier this year, the Bank of Japan had announced the creation of a Liaison and Coordination Committee that will include participants from both the public and private sectors. This committee was tasked with spearheading the pilot phase for a digital yen.

In its CBDC development, Japan will also assess the compatibility of these currencies in being used for cross-border payments. This will allow the digital yen to compete with China’s digital yuan in the international market.

Cross-border compatibility is a major issue faced by countries that are taking the bold step of developing their digital currencies. However, CBDCs are becoming likely, given that global financial institutions such as the Bank for International Settlements are also pushing for CBDCs.

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CZ hints that France is in the running as the new Binance global headquarters

Binance boss Changpeng Zhao (CZ) said France stands out as a “natural choice” to locate a regional or even global headquarters. “France will be a natural choice for a regional, and even perhaps global, head office.” Speaking to the French financial media group Les Echos, CZ talked about the challenge of setting up physical locations::Listen

Binance boss Changpeng Zhao (CZ) said France stands out as a “natural choice” to locate a regional or even global headquarters.

“France will be a natural choice for a regional, and even perhaps global, head office.”

Speaking to the French financial media group Les Echos, CZ talked about the challenge of setting up physical locations – a move prompted by the global regulatory clampdown on Binance, which started during the summer.

The backlash triggered a series of drastic changes to the platform, including the removal of Singapore dollar trading pairs and the reduction of futures leverage to a maximum of x20, to name a few.

In all instances, Binance said changes to how it operates were brought about by the need to meet regulatory compliance.

Binance looking to address regulatory concerns

While some observers saw the clampdown as an attack on crypto by targeting the world’s biggest exchange, others said changes to how Binance operates are long overdue.

In particular, the sub-Reddit r/Binance_Lawsuit features the stories of aggrieved Binance customers who describe their experiences as fraudulent to the extent of gathering support for legal action.

CZ has always maintained that Binance is committed to putting its customers first. Any problems experienced were down to the platform growing too quickly, rather than any deliberate attempt to defraud.

“Binance has grown very quickly and we haven’t always got everything exactly right, but we are learning and improving every day.”

In any case, CZ said the firm is responding by shoring up its compliance team, including the appointment of key figures with the necessary compliance experience at the board level.

Why is France so appealing?

A significant criticism leveled at Binance has been its decentralized structure. Meaning it does not have a physical headquarters with which to address complaints.

CZ said this is something they have been working to address, adding that the firm is looking at having a setup of local, regional, and global locations.

“However, this industry must be regulated. We are therefore in the process of setting up headquarters at several levels: local, regional and global.”

Commenting on how the French regulators, the Autorité des marchés financiers (AMF), have received Binance’s presence in the country, CZ said they were “pro-business,” clear, but very demanding.

Having applied for PSAN (digital asset service providers) approval, CZ added that more would be known in the next six to twelve months. And that a French location still depends on the outcome of the PSAN application.

The post CZ hints that France is in the running as the new Binance global headquarters appeared first on CryptoSlate.

Digital yen will focus in Simplicity in Design, BoJ Executive Says

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