A consortium of roughly 70 Japanese companies, including the country'southward biggest financial institutions, have joined forces to trial and launch a new yen-based digital currency in financial 2022, sending a strong indicate that the private sector was embracing blockchain-based payment systems.

The new digital currency, dubbed "DCJPY," volition be backstopped by depository financial institution deposits and rely on a common platform to expedite large fund transfers and settlements amongst the participating companies, according to Kazuhiro Tokia, the principal executive of cryptocurrency exchange DeCurret.

DeCurret is leading the consortium, which includes banks Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Financial Group. The consortium besides consists of Nihon Post Bank Co Ltd., Nippon Telegraph and Telephone Corp, E Japan Railway Co and Kansai Electric Ability Co Inc. Co-ordinate to Reuters, the group has been meeting regularly since 2022 to discuss creating a new settlement platform for digital payments.

In terms of total deposits, Mitsubishi, Mizuho, Sumitomo and Nihon Mail service Bank are among Japan's five largest financial institutions.

Inside the public sector, the Bank of Nihon has prioritized the development of a central bank digital currency, or CBDC, with a focus on providing seamless payment channels between the and so-called digital yuan and electronic payment services. While the BOJ is spearheading this effort, the end goal is to incentivize private-sector uptake of a CBDC. As Cointelegraph reported, the Bank of Japan's CBDC airplane pilot tests are expected to be completed by March 2022.

Related: Asian CBDC projects: What are they doing now?

The deposit-backed infrastructure existence developed by the consortium aligns with the BOJ's CBDC framework, according to DeCurret adviser Toshihide Endo, who previously served equally caput of Japan'due south Financial Services Agency.