A senior official from the Bank of Japan (BOJ) has reportedly issued a warning to countries in the G7 that a common framework for crypto regulations has to be established in the quickest time. 

Specifically, the response reportedly surfaced following the ongoing conflict between Russia and Ukraine, with crypto and their potential applications to avoid economic sanctions keep on being examined carefully. 

The head of the BOJ’s payment systems department, Kazushige Kamiyama, additionally remarked that stablecoins offer a simplified method for “creating an individual global settlement system”, consequently making it more simple for nation-states to steer clear of more traditional and regulated payment networks employing the US dollars, euro or yen for settlement.

Kamiyama further remarked that a sense of urgency is the most important, should the G7 nations hope to achieve effective coordination for crypto regulations, since the existing regulations do not entirely consider their growing adoption and proliferation across the globe.

Per Kamiyama, this regulatory framework would create an impact on the design process of Japan’s own central bank digital currency (CBDC) – the digital Yen. 

A necessity of carefully balancing individual privacy with worries related to money laundering and other white-collar crimes will also be required.

The governor of the BOJ, Haruhiko Kuroda, reportedly revealed during Japan’s FIN/SUM fintech summit on March 29th that there are currently no plans down their pipeline to roll out a CBDC in the near future. 

According to Kuroda’s explanations, the BOJ seeks to run a thorough examination of the expected roles of central bank money in the lives of Japanese citizens.

“We consider it important to prepare thoroughly to respond to changes in circumstances in an appropriate manner, from the viewpoint of ensuring the stability and efficiency of the overall payment and settlement systems.”