Fearing Chinese advantage, Japan lurches towards digital currency and electronic payments


TOKYO - As we’ve discussed before, Japan is largely a cash based society. Despite, at times, a healthy interest in digital cryptocurrencies like bitcoin, consumers rely heavily on physical currency while eschewing electronic payment methods. This is somewhat counter-intuitive, as the country has one of the most advanced regulatory environments in the world with regard to digital assets.

Either way, it’s indisputable that consumers prefer traditional forms of transacting. Checking accounts are virtually non-existent in the land of the rising sun, so cutting a check is rare. Credit cards, on the other, are widely available. Yet, consumers’ frugal attitudes result in limited use.

Indeed, use of credit cards account for some 17 percent of transactions. Compare this to 21 percent in America where consumers also rely heavily on other electronic payments. Moreover, the cash in circulation in Japan accounts for 20 percent of GDP, while physical tender accounts for 8.3 and 9.5 percent in the U.S. and China, respectively.

Still, Japan’s massive debt-load implies problems for the yen going forward. Currently, debt in the country accounts for 237 percent of GDP, the largest in the world. Historically, such an excessive debt-to-GDP ratio implies a high risk of default and a weak demand for a government’s bonds. According to Luke Gromen of FFTT research firm, 50 of 51 countries to ever reach a debt-to-GDP ratio above 130 percent have defaulted, Japan being the sole exception. When a developed country defaults, it typically inflates away its outstanding obligations by weakening its currency. If Japan were to succumb to this fate, it implies a tumultuous time for the yen.


A Cashless Society

Since late July, a team of about 10 members at the Bank of Japan (BOJ) have been working towards the development of a central bank digital currency (CBDC), a digitized version of the yen. Such a currency may rely on the cutting-edge blockchain technology that powers cryptocurrencies like bitcoin; however, this remains uncertain. The BOJ hopes that the new technology will be universally used even during natural disasters and power outages.

According to Takeshi Kimura, the BOJ’s department director-general, development is a top priority. He recently told the Asahi Shimbun, “We will move forward with discussions while pushing up the level of consideration beyond the preparatory stage.” Although Kimura noted that the CBDC will replace cash and force the consolidation of other electronic payments, he did not provide a timeline for the rollout.

Highlighting the government’s urgency, the BOJ recently appointed top economist Kazushige Kamiyama to head its payments and settlement department which oversees digital currencies. Kamiyama previously directed the use of big data in analyzing the effects of COVID-19 on the economy. As Japan drastically trails South Korea and China in digital payments, the move likely marks an acceleration of the program.

A Currency Race

Nevertheless, in a country that relies on cash for 80 percent of transactions, what motivates the sudden rush to go cashless? Competition in a post-COVID world is likely key.

The economic implications of the ongoing pandemic are vast, with numerous economists and analysts suggesting a slowdown in global productivity. American multinational investment bank Goldman Sachs recently warned that the U.S. government’s excessive fiscal spending could lead to a severely weakened dollar and its loss of its world reserve currency status. As the global reserve currency, the dollar is the primary currency in which most of the world's trade occurs. Current economic conditions have led world leaders to suggest a “Great Reset” to the global economy.

As China and Russia begin reducing their reliance on the dollar, a shift in the role of global currencies seems increasingly likely. A diminished reliance on global reserve currencies has already been underway since The Great Financial Crisis of 2008-2012.

The possibility of asserting its currency on the international stage has likely pushed China to become a front-runner in the digital currency race. If a digital yuan, currently under trial, were to be widely accepted it could streamline commerce and increase financial inclusion. Yet, the CCP would enjoy privileged access to transaction data, a valuable commodity in an increasingly digital world. As noted with Facebook’s Libra, the central bank policy of a dominant digital currency could overwhelm that of another nation.

All things considered, it remains uncertain whether China, or any single nation, will realize such influence. As Japan disinvests from China, government officials are unwilling to stomach such a risk. Yet, as the BOJ accelerates the development of a digital yen, it faces an uphill struggle updating the spending habits of an aging and cash-dependent society.

FOR ANY DIGITAL MARKETING SERVICES CONTACT OUR TEAM TODAY TO HELP. info@Vissicon.com #cybersecurity #hacking #security #technology #hacker #infosec #tech #ethicalhacking #programming #linux #hackers #cyber #kalilinux #cybercrime #malware #python #privacy #it #iot #cyberattack #coding #dataprotection #hack #ethicalhacker #networking #informationsecurity #cybersecurityawareness #programmer #datasecurity #itsecurity #informationtechnology #software #business #cloud #computerscience #computer #internet #cloudcomputing #network #windows #bhfyp #data #phishing #hacked #cybersecuritytraining #coder #ai #artificialintelligence #cisco #anonymous #code #ransomware #encryption #networksecurity #java #digital #training #bigdata #machinelearning


Originally published : https://japantoday.com

0 views0 comments
  • Facebook
  • Instagram
  • LinkedIn
  • Twitter
Copy%20of%20Copy%20of%20PERTH%20DIGITAL%
927 Beaufort Street, Mt Lawley,
Perth 6052
836/585 Little Collins Street,
Melbourne, 3000

Digital Marketing Agency Perth - Perth Digital Agency at your service. If you want your business to dominate the online world, you need to align yourself with a digital marketing agency that is not just following the latest trends but also creating them. Perth Digital Marketing is ridiculously competitive, so if you want your business to do more than just survive, you need to choose a marketing agency that is going to offer both proven strategies and outside the box thinking. At Vissi, we pride ourselves in offering revolutionary and proven strategies to help your business thrive and grow in the competitive online market. We work alongside your business every step of the way and ensure that you have the right tools you need to increase your profits and maximise your investment. We are experts in helping your business to find an endless line of customers that are ready and willing to spend on your products and services, using our clever and unrivalled marketing and conversion techniques. These techniques work almost instantly, which means that you don’t have to wait years to see growth or profits flowing in. In fact, most of the businesses that we work with begin to achieve their desired results in just a few months. How do we do it? It is our unwavering approach, dedication and out of the box thinking that has made us one of the premier digital agencies Perth. So, when it comes to selecting a digital marketing agency that is going to propel your business to new heights, don’t just take our word for it. Why not contact us today and see what we can do to help your business? Digital Marketing in Perth - Vissi started from humble beginnings in Perth and has quickly grown to become one of the top digital marketing agencies in the Perth digital agency scene.  Located in the Perth CBD, our digital agency caters to businesses both big and small in all areas of the city and beyond. By growing our business from the ground up in Perth, we know exactly what it takes to appeal to local audiences and how to navigate through the ever-evolving culture and economy of the city. We also pride ourselves on being able to offer Perth business owners some of the top proven marketing strategies that are breaking ground locally and all over the world. These strategies including helping your business to rank higher in search results and turning your traffic into leads that actually convert into paying customers.  In fact, we have helped brands increase profits by nearly ten times as much, all by following some of our proven methods. Whether you are a brick and mortar business or based solely online, Vissi is dedicated to helping you grow your business into a thriving profit machine, so you can spend more time doing the things you love and less time worrying about your business.

Perth Digital Marketing - Even though Vissi first started in Perth, we are quickly developing an extensive database of clients across Western Australia. We have worked with some of the biggest brands based out of Perth and have a strong track record in the area. But really, working with Vissi is super easy no matter where you live. We have a dedicated team that will help you every step of the way and ensure that your business is set up not just for short-term results, but for long-term success as well. After just a few short months of working with us, you will start to see your business growing rapidly. Your conversion rates will be up; your sales will be up, and of course, your profits will also be up. Guaranteed. Vissi is also one of the only digital marketing agencies out there that offer guaranteed results. We don’t do this as a desperate sales tactic, we do this because we stand by what we do 100%. Real Estate Digital Marketing - Digital Marketing for Real Estate Agents - Perth Digital Agency - Digital Marketing Agency Perth - Web Design Perth - Perth Web Design - SEO Agency Perth - SEO Perth - SEO in Perth - Perth SEO Agency - Perth web design - Ecommerce web design Perth - IT support Perth - IT Services Perth - Managed IT Perth  - Perth hosting – Busselton Digital Agency – South West Digital Agency – Digital Agency in Busselton

© 2020 Vissi Digital. Proudly designed and developed by Vissi Digital. Please review our TERMS & CONDITIONS and PRIVACY POLICY.