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Screenshot of a breaking news alert e-mail from Q2 2017
The Financial Times reported that Mizuho Financial Group and Japan Post Bank are forming a consortium to launch a domestic digital currency: the J-Coin. The idea is to make Japanese people less dependent on cash and fiat money.
According to FT, the Japanese consortium plans to launch the financial innovation just in time for the Tokyo 2020 Olympics. Oscar Williams-Grut, from Business Insider, reports that by introducing J-Coin, Japanese will be able to transact with their smartphones for buying goods and services.
Japan’s economy is highly dependent on cash, with 70% of all transactions by value coming from fiat money. The issue with this heavy cash weight on the Japanese economy is the undocumented cash-in-hand work, the “grey” economy and the lost tax revenues for the government.
Once launched and adopted, the FT reported that the value that J-Coin could add to the Japanese economy amounts to around $100 million. That will certainly offset some of the already sunk costs of the cash handled in Japan and could certainly stimulate the ease and efficiency of consumers buying goods/services.
Despite the criticism and heated arguments against the regulation issues that cryptocurrencies might create for governments and banks, more and more countries strive for “cashless societies”, including India, Denmark, Sweden and Bulgaria.