Japan's ruling Liberal Democratic Party (LDP) has officially approved a noteworthy policy proposal for the future of the financial sector. The proposal aims to establish a new generation financial system centered on artificial intelligence and blockchain technologies. This step could advance Japan's regulatory approach to digital assets, tokenization, and stablecoins. Titled "Next-generation AI & Onchain Finance Concept," the proposal was prepared by a project team within the LDP led by Seiji Kihara. Submitted to the party earlier this month, the text received official approval from the LDP Policy Research Council on Tuesday. Thus, the proposal has moved beyond being merely an internal party effort and has become a framework that can be transformed into government policy.
AI and blockchain are becoming the new infrastructure of finance
At the heart of the plan is the idea of an automated financial infrastructure operating on blockchain networks and capable of processing transactions around the clock. According to the LDP, the widespread adoption of AI-powered systems will also transform the way financial services operate. In particular, in the new trading model called "agent commerce," AI tools are expected to select products and services on behalf of people, manage payment processes, and initiate financial transactions. At this point, blockchain technology is seen as a significant complementary element in the proposal. The text emphasizes that blockchain's immutable record structure, verifiability, and programmability are compatible with AI-based trading systems. In other words, Japan wants to combine the decision-making and transaction initiation power of AI with the secure and transparent infrastructure of blockchain. One of the notable aspects of the proposal was tokenized deposits. The LDP specifically states that tokenizing the Bank of Japan's current account deposits is important. This approach could enable traditional banking infrastructure to work more compatibly with blockchain-based systems. Tokenized deposits could help create a more controlled bridge between bank money and digital asset technologies. Yen-denominated stablecoins also held a separate place in the proposal. The LDP prioritized ensuring legal clarity and mitigating systemic risks in the stablecoin sector. This emphasis reveals that Japan is trying to protect financial stability while supporting stablecoins. The proposal also states that it supports a joint stablecoin issuance project by Japan's three largest banks. This development shows that Japan wants to establish a more institutional and publicly supported model in the field of digital finance. The regulatory framework for stablecoins and digital asset services in the country has become clearer in recent years. The new proposal, however, does not limit this framework only to the cryptocurrency market; it offers a broader transformation plan that also includes banking, payment systems, artificial intelligence, and international cooperation. The LDP's proposal also calls for stronger cooperation with Asian countries in the fields of AI and blockchain. In this context, the Japan Financial Services Agency was asked to prepare a five-year roadmap that will encourage public and private sector investments. Such a roadmap could create a more predictable investment environment for both domestic financial institutions and technology companies. Following official approval, the LDP will work with relevant institutions and stakeholders to transform the proposal into government policy. Seiji Kihara, in a statement made via X, said that this is truly a "concept" and that the subsequent process will be built step by step. According to Kihara, the most important part will be the follow-up work that will be done after this stage.
