• Wed. Jun 7th, 2023

Governor Of Central Bank Of Japan Questions Use Case Of Bitcoin In Settlements

May 30, 2021

Japan’s Central Bank has been conducting experiments and subsequent tests for the eventual implementation surrounding its very own digitized currency. However, it has now also been stated that it is not exactly convinced when it comes to cryptocurrencies.

To this end, Haruhiko Kuroda, the governor for the Bank of Japan, had called into question the usage capability of the world’s flagship cryptocurrency as far as settlements may be concerned, going as far as to say that Bitcoin (BTC) does not really possess any kind of viable use case despite being the biggest cryptocurrency in the world right now in terms of market capitalization. As of the time of this writing, BTC is trading at $35,730, which is an 8.7% decrease since yesterday.

In related news, the bank has also been conducting tests for the digital Yen, which will be the official digitized version of the nation’s fiat currency.

‘Bitcoin hardly being used for settlements,’ says Kuroda

Kuroda’s stance had drawn several similarities to the comments made by Jerome Powell, the Federal Reserve’s 16th Chair, where it had been stated that the cryptocurrency market is little more than simple speculation and actions based on those speculations.

Kuroda had therefore claimed that Bitcoin is hardly ever utilized as any kind of means of investment, whereas more traditional and tried and tested financial assets have, in fact, been able to be used as such. Like Powell, Kuroda believes that much of the trading that does take place is purely speculative in nature and that the industry emits extraordinarily high amounts of volatility.

Bitcoin cast aside as support for stablecoins provided

Despite the aforementioned opinions, the bank has, in fact, allowed for the public usage of various cryptocurrencies in Japan (for the most part) and has more or less been generally favorable as far as cryptocurrency-based businesses and utilities such as crypto wallets and crypto exchange services are concerned.

The bank has therefore shifted its main focus primarily towards that of stablecoins, such as USDT (Tether). Furthermore, it is also being reported that the digital yen is currently being put through limited testing within an environment that is akin to that of a sandbox for trial and testing purposes. Lastly, Kuroda had also stated that, unlike Bitcoin, stablecoins do tend to possess assets to fall back on, which often contribute towards backing up their respective value. They also satisfy the various health governance codes and legal standards, Kuroda added.

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