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‘No single digital currency will dominate the world’ Bank of Japan now says

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There appears to be a disagreement within the top echelons of Japan’s government on the threat that China’s CBDC poses to the nation. Just last week, Kenji Okamura, vice-finance minister for Japan’s international affairs voiced concerns over its neighbor’s efforts in the space, stating “first-mover advantage is something we should be afraid of.”

Today’s statement from Kazushige Kamiyama, who leads the Bank of Japan’s (BOJ) CBDC efforts, appears to contradict this previous sentiment. He said that on the contrary, the first-mover advantage may easily turn into a disadvantage, and that no single digital currency will dominate:

“I don’t think a single digital currency will dominate the world, as long as each country makes full efforts to improve its settlement system.”

Kamiyama said that the BOJ is closely monitoring the progress of other nations in the space, and is hoping to learn from their efforts:

“We’d like to keep tabs on what other central banks are doing and learn from them, not just from China but from other countries”.

He also said that when and if the BOJ issues a CBDC, there is a possibility that the bank will implement caps on the quantity issued, and how much of the asset entities would legally be allowed to hold. He suggested that such restrictions could be put in place in order to prevent the flight of capital from commercial banks, elaborating that “It’s an option. But it’s not something we can say will definitely happen.”

While the CBDC race around the world is in full flight, the policymakers appear to be struggling with finding the right approach to what remains a novel idea.



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BoE hasn’t ‘made any decision’ regarding a CBDC, says fintech director

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At the 2nd Bund Summit held on Oct. 25, Bank of England fintech director Tom Mutton stated that while a central bank digital currency, or CBDC, was “a focus” for the Bank of England, the position the bank had taken this past March hadn’t changed. 

“We haven’t made any decision on whether or not to launch a retail CBDC,” said Mutton. “But we are exploring the pros and cons with interest.”

Specifically, the BoE exec stated the central bank was looking into payment options for people in the U.K. who were affected by the COVID crisis “to deliver safe, efficient and convenient payments to shoppers and merchants” — a role that a CBDC could potentially fill. He added that privacy was “a non-negotiable” for a retail CBDC, “there must be ‘no harm’ to monetary and financial stability,” and any digital currency released by the bank “must be able to coexist with, and complement bank notes and commercial bank money.”

According to Mutton, the challenges facing the central bank in releasing a CBDC includes promoting competition and innovation among other forms of money, ensuring technology doesn’t “dictate policy,” and working with other institutions for solutions.

“We can’t ‘go it alone,’” said Mutton. “Central banks need to partner with a broad range of stakeholders given the breadth of issues presented by CBDC.”

Mutton’s remarks are consistent with those of other leadership at the central bank. In July, BoE governor Andrew Bailey stated the bank was looking into the possibility of issuing a digital currency backed by fiat. However, Bailey has also been critical of cryptocurrencies like Bitcoin (BTC), stating that they lack “intrinsic value.”



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Bill Hinman, who spearheaded the SEC’s early crypto policies, is leaving the commission

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On Wednesday, the Securities and Exchange Commission (SEC) announced the departure of William Hinman by the end of this year. 

Hinman joined the commission in 2017 and is currently the director of the SEC’s Division of Corporate Finance. He also spearheaded the SEC’s early work with digital assets, in which role he has made critical contributions to the discussion of which cryptocurrencies qualify as securities. The announcement says:

“Mr. Hinman led efforts regarding the rapid innovation in digital assets, including by providing a framework that market participants could use to evaluate whether digital assets are offered and sold as securities.”

The SEC’s 2018 launch of FinHub, which focuses on digital assets, was also seen as a Hinman initiative. Valerie Szczepanik, who began her term at the SEC as an advisor to Hinman, currently leads FinHub, in which role the industry has nicknamed her Crypto Czar.

Current Deputy Shelley Parratt will take over the reigns for Hinman on an acting basis upon his departure. 



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Tether’s general counsel doubles down on support for Peter McCormack

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Stuart Hoegner, general counsel for Tether and cryptocurrency exchange Bitfinex, is pushing back against claims the stablecoin operator has abandoned podcaster Peter McCormack in his lawsuit against Craig Wright, the Australian national claiming to be Satoshi Nakamoto.

In an Oct. 24 tweet from Hoegner, the general counsel called a recent article from crypto media platform Coingeek which stated Tether had pulled funding from McCormack in his legal battle against Wright “a lie.” Coingeek is owned by Calvin Ayre, a high-profile supporter of Wright who backs his claims that Wright is the creator of Bitcoin (BTC).

“Tether supports Peter McCormack and believes he’s in the right,” said Hoegner.

In April 2019, Wright filed a libel claim against McCormack in the U.K. over McCormack accusing the Australian national of fraud and falsely claiming to be Satoshi. Hoegner said at the time that Tether would “stand behind” the What Bitcoin Did podcaster in his defense against Wright, which hinted at financial support.

However, in response to Hoegner’s denial, Ayre is not backing down.

“I was forwarded a copy of the letter from Peter’s lawyer saying he wants to settle because his funding was cut,” said Ayre on Twitter. “Tether said they were the ones funding him so this has to mean Tether cut funding. If Tether is still funding this makes no sense.”

He continued by promoting Bitcoin SV (BSV), for which both Ayre and Wright are well known proponents:

“My conclusion is that Tether executives know already that Craig is Satoshi and this is all just a big game to keep their scams alive. The smart play would be to move Tether to BSV and abandon BTC.”

Wright has filed several defamation suits against perceived rivals in the crypto industry. In August, he filed a libel suit against Bitcoin Cash (BCH) proponent Roger Ver in the High Court of Antigua and Barbuda. This followed The High Court of England dismissing a similar suit Wright filed against Ver in 2019. However, in April he also abandoned a $125,000 libel suit against Blockstream CEO Adam Back, agreeing to reimburse legal fees.





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