Executive Director Kazushige Kamiyama, the BOJ official responsible for payments and markets policy, addressed the Liaison and Coordination Committee on Central Bank Digital Currency on February 2, 2026. The committee brings together the central bank, government ministries, securities dealers, payment associations, and fintech companies to align cross-sector efforts on a potential retail digital yen. Kamiyama titled his remarks "Points Forming Lines, Evolving to Surfaces," a geometric framework describing how the bank's previously isolated experimental findings are now connecting into a coherent technical and policy picture. In the metaphor's progression, "surfaces" carries specific policy weight: it maps onto a systemic policy framework that is decision-ready, suggesting the bank's preparatory work has matured to the point where a structural commitment becomes actionable. The BOJ has said it will decide whether to issue a retail CBDC by the end of 2026.

The bank has not changed its formal position. It maintains there are currently no plans to issue a CBDC. Kamiyama reaffirmed as much at the 9th committee meeting in June 2025, while also noting that "inaction is not viable as technology advances and society digitalizes." That tension, between caution and urgency, has defined Japan's CBDC approach throughout its three-phase exploration: proof-of-concept work from 2021 to 2022, a live pilot experiment that began in April 2023, and the 2026 decision point now approaching.

What the Pilot Has Produced

As detailed in the BOJ's July 2025 progress report, the technical results from the pilot are substantive. The BOJ has tested parallel transaction processing at up to 50,000 transactions per second, using a record-splitting method that allows locked balances to be subdivided and processed simultaneously. The bank has also developed a privacy-preserving architecture that separates customer identity data from ledger settlement, so only anonymized settlement data passes through the core system. Sixty-four private companies across seven working groups are participating in the CBDC Forum, covering both established financial institutions and fintech startups. The Forum is a distinct body from the Liaison and Coordination Committee introduced above: the Committee handles cross-ministry and private-sector policy alignment, while the Forum serves as the more technical working structure where those companies develop and test solutions.

The pilot has also surfaced a significant problem. High-volume conversions between digital yen and conventional bank deposits risk overloading existing core banking infrastructure with excessive traffic. The BOJ has not publicly reported a resolution to this interoperability gap. Separately, the bank evaluated and rejected public blockchain infrastructure as unsuitable, citing scalability limits, inadequate privacy controls, and fragmented governance. Controlled Layer 2 solutions (permissioned networks built on top of a base settlement layer) are being explored as an alternative.

An API Sandbox initiative has allowed volunteer companies to build and test applications on top of the pilot system. Kamiyama noted in June 2025 that parallel progress in the sandbox and the working groups had allowed "the pilot program to advance efficiently on both system development and forum discussions simultaneously."

Regional Stakes: Remittances Across Asia and Africa

The architecture decisions being made in Tokyo carry direct consequences for communities far outside Japan. Japan hosts substantial migrant worker populations from Bangladesh, Nepal, the Philippines, Indonesia, Sri Lanka, and several West African countries. Japan's reliance on foreign labor has been accelerated by its aging demographic crisis, making the country an increasingly important source of remittances across Asia and Africa. The average cost of sending money to sub-Saharan Africa remains above 8% of the transaction value, according to World Bank data; remittances to South Asia run roughly 4 to 5%. A programmable digital yen with open settlement rails could reduce those costs materially, but only if non-bank service providers gain access to the infrastructure.

India received $129 billion in inward remittances in 2024, making it the world's largest recipient. The Reserve Bank of India operates its own CBDC pilot, the e-Rupee, and has already built cross-border QR payment links with Singapore and the UAE through its UPI network. A future Japan-India payment corridor built on compatible CBDC or tokenized deposit rails would represent a significant shift in how remittances move between the two countries.

Bangladesh received more than $30 billion in remittances in fiscal year 2025, with Japan an increasingly important source as its Technical Intern Training and Specified Skilled Worker programs expand. The core banking interoperability problem the BOJ identified in its pilot is precisely the type of friction that drives use of informal transfer channels. In the Japan-Bangladesh corridor, that means hundi networks, informal money transfer systems that Bangladesh's government has actively moved to suppress through enforcement campaigns. Resolving the interoperability gap is as much a financial governance priority as a technical one.

The Multilateral Layer

The BOJ's participation in BIS Project Agorá adds a cross-border dimension to all of this. The project, which involves seven central banks including the Bank of England, the New York Fed, and the Bank of Korea, along with roughly 40 financial institutions, is now in the testing phase. A first-phase report is expected in the first half of 2026. Project Agorá is designed to test tokenized cross-border payment settlement between participating jurisdictions. No African central bank currently participates, a gap that reflects broader structural inequities in global payment governance.

The BOJ's 2026 decision, when it comes, will land in a crowded global field. The US issued an executive order in January 2025 prioritizing stablecoin development over retail CBDC. The European Central Bank is accelerating its digital euro preparation. Of 134 countries globally exploring some form of CBDC, Japan's is one of the more technically developed programs among major economies, and among the most institutionally cautious. With Project Agorá's first-phase report expected in the first half of 2026 and the BOJ's own decision due by year's end, the concentrated period of consequence runs from now through the close of 2026. It will tell the region whether years of pilot work are about to become infrastructure.