Catenaa, Thursday, March 05, 2026- Bank of Japan will test blockchain-based settlement for its current account deposits, Governor Kazuo Ueda said Tuesday, signaling a step toward integrating distributed ledger technology into core financial infrastructure.
Speaking at the FIN SUM conference in Tokyo, Ueda said the central bank is developing a sandbox to examine whether central bank money can function within blockchain systems.
The trials will focus on reserves held by financial institutions at the BOJ and explore use cases including domestic interbank transfers and securities settlement.
Ueda said combining tokenized central bank deposits with smart contracts could enable faster execution and improve efficiency.
The BOJ plans to work with external experts while examining how blockchain-based mechanisms could connect with existing systems.
The initiative aligns with Project Agora, led by the Bank for International Settlements, which brings together multiple central banks to study cross-border wholesale settlement using tokenized central bank money.
Japan is among participating jurisdictions exploring issuance of tokenized deposits on blockchain platforms.
Ueda said such efforts could streamline cross-border payments if implemented.
Separately, the BOJ continues its pilot for a potential retail central bank digital currency, testing core infrastructure and operating a CBDC Forum with private sector participants.
The bank plans to broaden discussions in the next phase, though no timeline was given.
Japan’s broader regulatory framework is also evolving. In November 2025, the Financial Services Agency moved to reclassify 105 cryptocurrencies, including bitcoin and ether, as financial products under existing rules.
