Japan Plans Blockchain System for Real-Time Securities Settlement

Japanese government bond repurchase agreements are a critical source of short-term secured funding, with JGBs widely used as collateral by domestic and overseas institutions. Moving the trade lifecycle on-chain could shorten settlement times, reduce delivery and counterparty risks, and free up capital otherwise tied up during processing. MUFG is following experiments in Europe and the United States, where intraday government-bond repo services have advanced toward commercial use.

MUFG said on Aug. 13, 2026, that MUFG Bank, Mitsubishi UFJ Trust and Banking and Mitsubishi UFJ Morgan Stanley Securities would work with Digital Asset, Progmat and other partners on the proof of concept. The trial will use the Canton Network to test on-chain JGB repo transactions, covering trading, account administration and cash settlement, with a goal of real-time, round-the-clock processing. Japan’s Financial Services Agency backed the project in February under its Payment Innovation Project. Transaction values, the testing timetable and a commercial launch date were not disclosed.

The Bank of Japan is assessing whether reserves held by financial institutions at the central bank can be tokenized and used as a final settlement asset on blockchain networks. The initiative could affect interbank payments and delivery-versus-payment securities settlement while addressing the limitations of systems that do not operate around the clock. Japan is also participating in Project Agorá, an initiative led by the Bank for International Settlements and the Institute of International Finance that connects seven jurisdictions.

BOJ Governor Kazuo Ueda said at FIN/SUM 2026 on March 3, 2026, that the central bank had launched a sandbox to test links between reserves and BOJ-NET, as well as interbank and securities settlement. The program has not disclosed a test amount or launch timetable. Project Agorá completed its prototype and initial testing on June 11, with more than 40 private-sector financial institutions participating, and will next conduct tests using actual amounts.