Can bitcoin end Japan's deflationary nightmare? This question may seem odd, considering Tokyo was site of the virtual currency's biggest scandal. But as the Bank of Japan's efforts to print trillions of dollars of cash backfire, it's time to inject a dose of technology.
The BOJ's negative interest rate policy is a case in point. Introduced on Feb. 16, the move shocked markets and had many Googling "NIRP." While the European Central Bank had dabbled with it for some time, Japan's step into the sub-zero world confounded many. None more so than Japan's 126 million people, many of whom have taken to hoarding ¥10,000 bills to stash under tatami mats.
BOJ Gov. Haruhiko Kuroda's claims negative rates are working smack more of denial than confidence, something in little supply before the BOJ made things worse. As growth evaporates, odds are that Kuroda will churn even more cash into markets. That would be akin to applying an analog solution to a digital-world glitch. The BOJ, you see, doesn't have a financial problem, but an equipment one.