There you go, another national bank expresses interest in the technology.
I know for the tech savvy you think news like this is getting boring but for the real enthusiast it’s getting more and more exciting!
Bank of Japan Dep Governor Talks Bitcoin, Fintech, Mt. Gox and Blockchain
The Deputy Governor of the Bank of Japan, Hiroshi Nakaso, has revealed that there is no plan to issue digital currencies as a substitute for banknotes at the present time. Still, the official added the bank would “make utmost efforts” to understand and research blockchain technology, an innovation “born” with bitcoin in 2008, as stated by Nakaso.
The Deputy Governor was speaking [PDF] at the University of Tokyo – Bank of Japan Joint Conference in Tokyo late last week. He opined that blockchain or distributed ledger technology (DLT) presents significant potential to affect “money” and “ledgers”, the basic pillars for financial activities.
Financial Inclusion in Developing Countries via FinTech
Fintech models simulate positive feedback between finance and the economy, Nakaso stated, due to financial inclusion bought on by FinTech innovation.
If people in developing countries gain new access to financial services through FinTech, they will gain opportunities to expand business such as e-commerce and e-learning, which are currently hampered by constrained access to payment services. In this manner, FinTech is expected to contribute to economic development.
Furthermore, the senior central bank official categorized financial technology into three separate types, namely blockchain, AI and big data, and smartphone innovation through massive adoption of devices in the past decade.
“In my view,” the official said, categorizing Fintech, “the first category includes ‘blockchain’ and LDT, which were invented in 2008 with the concept of “bitcoin.”
The cumulative use of these innovations could help establish a “virtual bank” without the need for any tangible infrastructure, the official added.
Pointing to blockchain, “born in 2008” with bitcoin as the “flagship technology” in Fintech, the official further opined that a majority of the efforts to implement the technology into real-world scenarios are still at an experimental stage.
Fintech advances could lead to a number of issues, the official added, particularly with regulation and taxation.
Moreover, if FinTech stimulates economic transactions through the internet and smartphones as well as business applications of DLT, it might become increasingly difficult to identify the physical “location” where transactions take place and the relevant ledgers are kept. This could lead to a variety of issues including those related to regulation and taxation.
The Mt. Gox Debacle
Nakaso highlighted the overlap that occurs when decentralized ecosystems like bitcoin see centralized trust, as in the case of users’ bitcoins stored among now-defunct bitcoin exchange Mt. Gox’s wallets.
“People tried to avoid the cost of managing keys accompanying decentralized-type information processing by entrusting their keys to a third party, Mt. Gox”, the official stated.
The eventual failure of bitcoin’s most-notable implosion is not the fault of bitcoin itself, but that of Mt. Gox, he said………
Read more : CCN.com, by Samburaj Das, Bank of Japan Dep Governor Talks Bitcoin, Fintech, Mt. Gox and Blockchain