Japanese Banking Giant Mizuho’s J-Coin Should Not Be Mistaken for a Cryptocurrency
Originally published on: CoinSpeaker
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March 07, 2019
Last week, the news broke out that Japan’s banking giant Mizuho is soon to launch its own cryptocurrency J-Coin. Considering Japan being the most crypto-friendly nation, it wasn’t much of a surprise. Several news outlets including Coinspeaker reported about J-Coin’s arrival this month.
However, according to a report from Quartz, it turns out that J-Coin is not a cryptocurrency. Thus J-Coin has nothing to do with blockchain as well, functionality wise. Instead, Mizuho’s J-Coin is just an initiative in-line with the Japanese government’s attempt to move towards a digital economy.
A Push for Digital Economy
Currently, Japan lags a lot behind compared to other developed economies when it comes to moving digital. A majority of the transactions happen through cash. However, there are several reasons for the low adoption of digital payments.
The negative banking interest rates discourage people to go digital while encouraging to hoard more cash. Furthermore, the extremely low crime rate in Japan makes it comfortable for people to carry cash. Also, the majority of the Japanese population is turning old. Hence there is a lesser willingness among them to move and adopt new for digital payments.
With the Tokyo 2020 Olympics approaching closer, the Japanese government is encouraging several financial institutions to push ahead its digital drive. The Mizuho bank will thus implement a QR code-based smartphone payments system. This approach is quite similar to that employed by Chinese platforms like WeChat Pay and Alipay. These two currently serve over 700 million users in the Chinese financial market.
The QR code system will integrate users’ bank account and allow them to instantly pay for goods and services.
Digital Is Not Always Cryptocurrency
Over the last few years, cryptocurrencies have made a huge impact on the global economy. Thus digital payments have turned synonymous to crypto payments. Furthermore, the name J-Coin sounds quite similar to other crypto tokens in the market. Two years back in 2017, a Mizuho spokesperson told CNBC that they are developing a “digital currency platform”. Also, the new digital currency shall be linked to the Japanese Yen.
However, we can safely predict that the digital push by the Japanese government can help its local companies to move towards blockchain-based payments systems which are more secure and fast.
Currently, there’s a lot of buzz in the global financial market for virtual digital currencies. Also, a number of big corporations are slowly shifting towards adopting the crypto bandwagon. Recently, the American multinational investment bank JP Morgan Chase announced to launch JPM Coin ahead this year.
Based on blockchain technology, the JPM Coin will facilitate faster money transfer across the entire suite of JP Morgan’s global clients and associates. Currently, the bank doesn’t plan to use JPM Coin for the retail purpose.
On the other hand, tech giant Facebook also announced to launch its “Facebook Coin” for use across all of its messaging platforms. Initially, it will launch the crypto token on WhatsApp while integrating it later with the infrastructure for Messenger and Instagram.