Japan's LDP Proposes AI-Blockchain Finance Plan Centered on Stablecoins and Tokenized Deposits
Japan's ruling Liberal Democratic Party released policy recommendations for building a financial system that combines artificial intelligence and blockchain technology, with stablecoins and tokenized deposits as core components.
The "Next-Generation AI and On-Chain Finance Vision" project team, operating under the LDP's Policy Research Council, outlined plans to automate payments, lending, and asset management while enabling round-the-clock financial services. The party identified finance as a potential "18th growth investment sector" for Japan.
The proposal directly addresses what the LDP calls the era of "agentic commerce"-a system where AI agents conduct economic activity autonomously. On-chain financial infrastructure, the party argues, is essential preparation for this shift.
Two Pillars: Tokenized Deposits and Stablecoins
Tokenized deposits (TDs) and stablecoins (SCs) form the foundation of the plan. The LDP set a deadline of year-end 2024 to organize and disclose key issues surrounding the tokenization of Bank of Japan current account deposits and a wholesale central bank digital currency.
For stablecoins, the proposal calls for ministries to jointly establish their legal status, enabling use for salary and tax payments. The party is also reviewing a joint stablecoin issuance plan involving Japan's three megabanks, with operations targeted to launch by March 2025.
Current stablecoin issuance in Japan totals approximately 45 trillion yen ($312 billion), dominated by dollar-based options like Tether's USDT and Circle's USDC.
Real-World Asset Tokenization and Regional Expansion
The LDP proposed tokenizing real-world assets-including accounts receivable and real estate-to develop Japan's asset-management industry through on-chain infrastructure.
The party also outlined regional and global coordination strategies. It called for an "AI and On-Chain Finance Asia Policy Dialogue Framework" and a "Global Stablecoin Corridor Initiative" to expand cross-border payments using yen-based stablecoins.
Sovereignty and Security Concerns Drive Timeline
The LDP warned that delays in adopting on-chain finance could deepen Japan's reliance on overseas payment systems and weaken monetary sovereignty. The party said the Financial Services Agency should lead a five-year roadmap with joint public-private investment.
The proposal also flagged quantum computing as a threat to blockchain cryptography. It urged Japan's Digital Agency to establish permanent monitoring and develop response measures.
The recommendations reflect a shift in how governments approach AI for Finance infrastructure, moving from theoretical frameworks to concrete implementation timelines and regulatory structures.
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