[2017-11-23]Cryptocurrencies “Too Far Off” to Kill Physical Cash: Bank of Japan

[aysha9872]

Cryptocurrencies “Too Far Off” to Kill Physical Cash: Bank of Japan Official

The head of the Japanese central bank’s payments department doesn’t see digital currencies like bitcoin replacing physical cash anytime in the near future.

Speaking at a FinTech forum in Tokyo on Wednesday, Bank of Japan (BOJ) senior official Hiromi Yamaoka revealed he doesn’t see the conventional banking industry under any immediate threat from digital currencies. Yamaoka, who heads the Japanese central bank’s payment and settlement systems department, opined physical cash is here to stay despite major disruptive gains led by financial technologies in recent years.

The central bank official is quoted by Reuters as stating:

It’s too far off…It would change the banking system too drastically.

Yamaoka offered similar remarks last year, when stating digital currencies won’t replace the physical cash printed by central banks – particularly in countries like Japan with an ‘established financial infrastructure.’ Earlier in March this year, the official confirmed the central bank would “seriously consider” the prospect of issuing its own digital currency, an effort undertaken by several counterparts in China, Singapore, Canada and Russia, among several others.

ICOs: “Tremendous” Hype

Sticking with his opinions on the cryptocurrency industry, the central bank official claimed the hype surrounding initial coin offerings (ICOs), a hugely popular and radical new form of fundraising powered by cryptocurrencies, was “quite tremendous”.

He went on to add that blockchain technology, the underlying innovation of decentralized cryptocurrencies like bitcoin, aren’t mature enough to power the world’s biggest payment rails. Contrary to the central banker’s remarks, a number of Japanese banks are already testing blockchain-powered domestic fund transfers to replace ‘Zengin’, the current national payments clearing platform that restrictively allows money transfers between 8:30 AM and 3:30 PM in the country.

Despite its stature as one of the world’s leading economies and contrary to the notions of a technology-forward society, Japan is lagging behind China and Korea when it comes to cashless digital payments. The current adoption rate of digital payments in the country is a measly 19%, compared to both China and Korea at over 50%.

As a result, the government of Japan has mandated a FinTech growth strategy to double the adoption rate of digital payments, aiming to hit 40% to pull level with the United States within the next decade. Japan’s embracive stance toward financial technologies has already seen bitcoin recognized as legal tender in the country, following legislation that came into effect in April. Furthermore, Japan’s financial regulator recently granted regulatory licenses to 11 bitcoin exchanges to operate in the country.

Source: https://www.cryptocoinsnews.com/cryptocurrencies-far-off-kill-physical-cash-bank-japan-official/

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[Rahar02]

the conventional banking industry under any immediate threat from digital
I don't think bitcoin or other coins is a threat to conventional banking, even for cash, as not everyone agrees not to use cash anymore.
There are some advantages of using cash such as instant and anonymous transactions between two parties.
We have been using cash and digital form of cash through bank or third party systems, there is no problem at all of you are using both. But, the point is; bitcoin can't replace bank system or kill physical cash due to some usability which people really need for now. Even if you want to buy or sell bitcoin, you have to use a bank account to do so.

[rjbtc2017]

Which is true, I do not know why Other Countries' Government and Central Banks are afraid on Digital Cash and CryptoCurrencies when the whole world is not yet even accepting Bitcoin and is currently on process of how to regulate it. By observation and even in by logical thinking.

Do you think stores will just put Bitcoin as their primary payment and just kick out the FIAT?, when FIAT is the one who used for paying taxes, also , FIAT as physical coins is WIDELY used on little markets, small stores and on Public transportation like jeepney/bus/tricycle fares ( in Philippines of course).

I don't see Bitcoin taking over Physical Cash, Government should not be worried and even Central Banks, they can still continue their services and their activities and also their Businesses. Even if the demand on usage on Bitcoin as a primary currency, I think the Government is the one who has the final decision on what currency to be used.

[entrepmind23]

I can't really see cryptocurrencies replace cash in the future because technology is limited. Banks are spreading fear, uncertainty and doubt to people about bitcoin because it is affecting their business but the truth is that people still need them because cash can't be eliminated. There's about 16% of the people in the world or 1.2 billion people have little or no access to electricity and for those who have, about 40% have internet access so it would still be hard to implement something in which every one cannot have access. For those 40% who have internet access, who knows how many have knowledge about cryptocurrencies. It is slowly getting popular but still many just use it as store of value instead of currency.

[hatshepsut93]

Sure cryptocurrencies can't compete with banks at the moment because they can process only a few, or a couple of dozens transactions per second, but technologies sometimes can be improved very rapidly, so it's quite possible that within the next 5-10 years cryptocurrency protocols will get major improvements that will allow them to boost their capacity and provide new additional benefits to their users. Besides, the demand for capacity grows gradually, and Bitcoin can easily be used as currency today as its fees are quite competitive, unless there is a spam attack or difficulty manipulation due to miners hopping to forks.

[senin]

The Crypto currency can only squeeze the usual paper money in the zonal part, but not replace them completely. It can largely replace non-cash money. However, this is all up to the people. There will always be a significant number of people who will use cash. In addition, technology and technology in us are not yet developed enough to switch to the exclusive use of crypto currency. In addition, in order to switch to the use of crypto currency, a developed infrastructure is needed for this, which is only now emerging.

[Kemarit]

There's no discussions or arguments as far as Physical Cash vs Bitcoin. Crypto will never replaced fiat for all we know. Those trying to sell this idea is either creating a FUD to pull back the price of bitcoin, or those bankers who are really feeling the pressure of cryptocoin. But if you look at it closely, not only Japan but almost all nation still lacks the infrastructure for a cashless society. Only few nations have experimenting cashless, but I haven't heard anything concrete that made me believed that it will be the trend in the future. That's why Japan legalized bitcoin in the first place because they don't think that crypto can compete with the banking industry, contrary to those country banning bitcoin because they perceived it as a threat.

[Guardian.P]

I hope not only in Japan but also in the near future, many countries will change their mind and recognize bitcoin as legal tender in their countries. It was good for tourism, it's not necessary to change your money for this country's money

[Lancusters]

I hope not only in Japan but also in the near future, many countries will change their mind and recognize bitcoin as legal tender in their countries. It was good for tourism, it's not necessary to change your money for this country's money

You are not right. People will have to change bitcoins into local currency. In the economy of the state involves only local currency. Around the world are now recognized as international currency the dollar but that does not mean that you can in any country to buy something for dollars. Bitcoin will never replace Fiat because they have different goals, management and purpose.

[IAMYOURLEADER]

It will really not kill cash because government of many small countries has already declared that they won't recognize btc and some already banned it completely.