Japan’s central bank is testing blockchain tech but has limited its work to research, according to one of its senior officials.
Governor Haruhiko Kuroda spoke earlier today during the Paris EUROPLACE Financial Forum in Tokyo. In remarks, he spoke about the opportunities and challenges regarding new kinds of technology in finance today.
Earlier this year, Kuroda speculated that blockchain could reshape some financial processes, and in May called on other central banks to pursue research efforts like the ones currently being undertaken by the Bank of Japan. Some of the world’s central banks, including those in Canada, Singapore and the UK, have moved in the past year and half to explore possible applications in the areas of transaction settlement and financial monitoring.
Yet according to Kuroda, the Bank of Japan isn’t looking to apply the tech to its own operations, instead focusing squarely on research.
Kuroda told attendees:
“Accordingly, the staff in the Payment and Settlement Systems Department of the Bank are deepening their understanding of such new technologies by test-driving distributed ledgers. Note that these trials by the Bank’s staff simply aim to understand the mechanics of DLT, rather than applying it to the Bank’s own liabilities or its payment and settlement systems.”
Japan’s financial sector, on the other hand, is putting its past research into action.
Last week, several major Japanese banks released the initial results of an interbank payments trial. According to those involved, the prototype system used enabled cheaper transactions compared to existing methods, setting the stage for further research.
Financial institutions across the Asian-Pacific region have spent much of the past two years investigating the tech, both individually and as part of consortia efforts.
Correction: this article originally identified governor Haruhiko Kuroda as the deputy governor.
Image via Shutterstock