Digital Currency Forum Japan Concludes Phase One with Multi-Bank Deposit Token Pilots

The Digital Currency Forum, convened by the Japanese Bankers Association and chaired by Hitoshi Yamaoka, has completed its first phase of deposit token work after eighteen months. Over 90 financial institutions participated across working groups examining regulatory frameworks, technical infrastructure, and business models. The Forum ran pilot transactions involving three banks using interoperable deposit tokens on shared ledger infrastructure, demonstrating atomic settlement of tokenised deposits against securities and foreign exchange.

The June plenary noted that participants have agreed on core design principles: interoperability across issuing banks, programmability for conditional payments, and alignment with existing payment regulation. A second phase beginning in September will expand the pilot network to non-bank participants and test cross-border scenarios with counterparts in Singapore and Switzerland. No launch date for commercial deposit tokens has been set, but the Forum expects issuers to approach the Financial Services Agency for licensing guidance before the end of 2026.

Yamaoka’s summary emphasised that the deposit token model under discussion retains full reserve backing and issuer liability, differentiating it from algorithmic or asset-referenced tokens. The Forum also acknowledged unresolved questions around tiering of access, privacy protections, and the treatment of unhosted wallets, which will form workstreams in the next phase.