Japan Plans Blockchain System for Instant Securities Settlement

The Government of Japan is preparing to establish a blockchain-based payment infrastructure designed to enable the instantaneous settlement of stock and Japanese government bond transactions. Under current protocols, stock trades settle two days after execution, while government bond transactions require one day for settlement.

A study group consisting of the Financial Services Agency, the Ministry of Finance, the Bank of Japan, and various financial institutions will launch this summer. This group is tasked with designing the system and defining institutional responsibilities, with the goal of formulating a development plan by early 2027 at the earliest.

If the plan receives formal approval, the system could become operational in the early 2030s. Officials indicate that the instant payment system may eventually extend beyond domestic securities to include international remittances, which would allow investors to reinvest proceeds from asset sales almost simultaneously.