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Bank of Japan Launches Sandbox to Test Blockchain Settlement of Central Bank Reserves

The move extends the BOJ’s digital money work into wholesale settlement to evaluate blockchain’s role in core payments.

Overview

  • Governor Kazuo Ueda announced trials to settle current account deposits on distributed ledgers for domestic interbank and securities transactions.
  • The project, framed as an experimental sandbox, will study connections with existing payment and securities systems and draw on external experts.
  • Experiments will explore tokenization features such as smart contracts and atomic transactions, with AI highlighted for analytics and risk controls.
  • The BOJ continues participation in BIS-led Project Agorá to examine tokenized central bank deposits for cross-border payments.
  • The retail CBDC pilot that began in 2023 remains in technical testing with no decision to issue a digital yen.