Nearly 80% of Japanese institutional investors plan to allocate to crypto within three years, according to a survey by Nomura and Laser Digital published in April. Japan could lose these investors to other jurisdictions, Nikkei said, as the U.S. and Europe race to modernize capital markets through tokenization, while Wall Street pushes toward 24/7 tokenized stocks.
The bond tokenization plan builds on existing momentum. MUFG said earlier this month that it is preparing a proof of concept for onchain JGB settlement using the Canton Network. Japan’s top three banks, MUFG, SMBC, and Mizuho, are already running a pilot on tokenized stocks and JGBs.
The BOJ expanded its blockchain settlement sandbox, a safe, isolated digital testing workspace, in March to continue its CBDC and blockchain efforts, including making them interoperable with legacy interbank and securities settlement infrastructure.
The BOJ is also involved in Project Agorá, a Bank for International Settlements (BIS) initiative that brings together seven central banks and more than 40 financial institutions to test tokenized cross-border payments. Japan’s new blockchain settlement infrastructure could serve as a foundation for that effort
