Ex-Japanese digital minister warns on-chain finance lag threatens security

Japan's Liberal Democratic Party (LDP) Digital Headquarters has discussed a next-generation finance proposal centered on stablecoins, tokenized deposits, and the on-chain tokenization of real-world assets (RWA). Takuya Hirai, who served as the country's first Minister for Digital Transformation, stated on X that a structural shift is underway where AI and blockchain are creating an automated, interconnected system for the economy, finance, and payments. He described a new economic foundation where transactions, settlements, and financing are unified, with AI agents handling real-time decision-making. Hirai warned that as dollar-based stablecoins become more widespread, competition for leadership in financial infrastructure is intensifying. He added that if Japan falls behind in this trend, it could impact its economic security and monetary sovereignty. The Digital Headquarters has designated finance as its 18th growth sector and plans to accelerate the development of on-chain financial infrastructure through public-private partnerships.