Japanese banks thinking to create Japan’s own cryptocurrency

Japanese banks are working together to create the country’s own cryptocurrency, called J-Coins. The plan is currently in initial stages with no backing from regulators.

The Mizuho Financial Group is leading a group of banks that are working on creating a cryptocurrency for Japanese nationals. This cryptocurrency will be called J-Coin and will be pegged to the Japanese Yen, with payments possible through a mobile app.

Japan has seen a spike in the bitcoin trading since China banned the practice. While previously, the Japanese government formed a task force to put bitcoin transactions under surveillance, it now seems that Japanese banks are also looking to get in on the action. They don’t want to regulate bitcoin and instead want to come up with a cryptocurrency of their own. The plan is only in the initial testing phase and there’s no certainty whether it will actually go through.

The news was given to CNBC by a spokesperson from the Mizuho Financial Group, who are leading this endeavor. This spokesperson said that other banks involved include the Japan Post Bank. While the spokesperson didn’t reveal which other banks are part of this group, he did say that they are looking to create the J-Coin and make it operational in time for the 2020 Tokyo Olympics.

A lot of work has to go into creating a national cryptocurrency that is owned and operated by a group of banks. While people can be sure of better security measures than cryptocurrency services have today, they will be wary of the transaction fees and focus on user validation and identification. If cryptocurrencies are expected to continue to thrive, some sort of validation is necessary as a lot of cryptocurrency related breaches have been reported in recent months and years.

The Mizuho Financial Group thinks that the blockchain technology, which is the underlying framework of cryptocurrencies, is something that is both lucrative and revolutionary. They even tried a blockchain transaction and were successful in sending important documents to Australia. Since then, they have doubled their efforts to incorporate this technology and are now leading a group to create Japan’s own cryptocurrency.

Japan has always supported cryptocurrencies. The country made bitcoin a legal payment system earlier in 2017. Following this decision, a number of large retailers began accepting Bitcoin payments from customers. This will not only put Japan in touch with the current and future market trend, but also discourage people from cash transactions.

A lot of Japanese nationals still use cash as their primary mode of payment. Regulators are looking to change this. The Mizuho Financial Group believe that J-Coins will help them do so. Although there is no news from regulators about this as of now, this could actually happen if the group of banks involved in the testing of J-Coins prove that it is a safe and efficient way to make payments.