Japan initiates CBDC pilot, after achieving success in second PoC experiment
Bank of Japan reported the success of its proof-of-concept experiment and now goes ahead with the CBDC launch. It even plans to examine its use among businesses
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The Bank of Japan (BOJ) has announced results of the second phase of its proof-of-concept (PoC) experiment. This phase of the CBDC experiment, running from April 2022 to March 2023, took into account supplementary functions to the basic ledger functions that had been tested in the first phase.
Its purpose was to test technology for implementing upper limits on CBDC holdings, which the BOJ described as “safeguards ensuring the stability of the financial system” in case there is a sudden shift in the monetary system from bank accounts to the CBDC.
Cases in which a single user has multiple accounts with multiple intermediaries come under this. The convenience of users to initiate and schedule their payments was also inspected.
Some backend experiments involved tests with the database language and design of the ledger along with the trial of a flexible-value token model. For a more speedy handling of multiple transactions with the same account, an orchestration system was also executed.
100,000 users were assumed with five intermediaries in the experiment which examined loads of 500 and 3,000 transactions in one second. Focus on increasing scalability and enhancing privacy was also discussed in brief in the experiment. In light of preventing fraud and preserving privacy, offline payments were also considered.
