BOJ CBDC Pilot Project Launched in April, Releases Results of Phase 2 of Proof-of-Concept Experiment

The Bank of Japan (BOJ) has released the results of the second phase of its central bank digital currency (CBDC) proof-of-concept (PoC) experiment, confirming that its CBDC pilot project was launched as scheduled in April. The second phase of the PoC ran for a year from April 2022 to March 2023 and considered features to complement the basic ledger functionality tested in the first year-long experiment. According to the Bank of Japan report, the second phase tested the technique of imposing a cap on CBDC holdings, which it described as a "safeguard to ensure the stability of the financial system" in case of sudden transfers of bank accounts to CBDC. It also examines the ease with which users can initiate and arrange payments.