• A Bank of Japan official has called on the G7 countries to adopt common crypto regulations

  • The Bank of Japan has warned the G7 nations that a common regulatory framework for cryptocurrencies must be implemented quickly in order to discuss the use of digital assets to circumvent sanctions.

    A senior Bank of Japan (BOJ) official has warned the G7 nations that a common framework for regulating digital currencies must be put in place as soon as possible.

    The Group of Seven (G7) is an inter-governmental political forum comprised of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.

    The statement is in response to the ongoing conflict between Russia and Ukraine, as cryptocurrencies and their potential applications for circumventing economic sanctions come under increased scrutiny.

    Kazushige Kamiyama, head of the BOJ’s payment systems department, said that using stablecoins makes it very easy to “create an individual global settlement system,” making it easier for nation states to avoid more traditional and regulated payment systems that use the US dollar, euro, or yen for settlement.

    Kamiyama added that the G7 nations must act quickly if they are to effectively coordinate regulation of cryptocurrencies and digital assets, as current regulations do not fully account for their global adoption and proliferation.

    Kamiyama went on to say that this regulatory framework would have an impact on the development of Japan’s own central bank digital currency (CBDC), the digital yen. Individual privacy would have to be carefully balanced against concerns about money laundering and other white-collar crimes.

    Haruhiko Kuroda, the governor of the Bank of Japan, stated on Tuesday at Japan’s FIN/SUM fintech summit that the BOJ has no plans to introduce a CBDC anytime soon. Kuroda stated that the BOJ intends to carefully consider the expected roles of central bank money in Japanese citizens’ lives.

    “From the standpoint of ensuring the overall stability and efficiency of the payment and settlement systems, we believe it is critical to thoroughly prepare to respond to changes in circumstances in an appropriate manner.”

    Kuroda’s comments come just four days after the BOJ announced that it has entered phase two of testing the viability of a Japanese CBDC. Phase two is set to begin this month, so any new G7 regulations will have an impact on this process.

    Kuroda stated that a decision on whether to issue CBDC in Japan will most likely be made in 2026, depending on the rate of CBDC adoption in the rest of the world.

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