China could gain a decisive advantage on the „new battlefield“ of digital currencies.
The Japanese government has expressed renewed concerns about the rapid progress of China’s planned Central Bank Digital Currency (CBDC).
Kenji Okamura, Japan’s senior financial diplomat, has accordingly warned the world community of the potential risks that could accompany China’s „digital yuan“, Reuters reported on 9 October.
According to Okamura, the development of the digital currency is progressing „in great strides“, with China deliberately aiming to be the first country to launch its own CBDC.
„We should be afraid of the first-mover advantage,“ as Okamura therefore said at a digital conference of central banks. The first mover advantage is an advantage that is created for the market participant who enters the market first.
In this respect Okamura adds:
„The big advantage of being the first to determine the design standards and technological platform that should guide all those who want to use their digital currency“.
The Japanese diplomat’s warning words come just after a Chinese magazine published by the country’s central bank announced that China will be the first nation to launch its own digital currency in 2020. In the accompanying article, the authors predict that the central bank digital currencies will become the „new battlefield“ between nation states.