Japan’s FSA, BOJ, and top banks aim to replace T+2 settlement with round-the-clock blockchain trades by the early 2030s, starting with a summer study group. MUFG leads PoC.
Japan’s top financial regulators and largest banks are launching a joint study group this summer to replace the country’s stock and bond settlement infrastructure with blockchain-based systems, aiming for round-the-clock, real-time settlement by the early 2030s.
The Financial Services Agency, the Ministry of Finance, and the Bank of Japan will sit alongside Mitsubishi UFJ Financial Group, Mizuho, Nomura and other major institutions, according to a government outline of the initiative. A development plan is expected by early 2027, with a full operational framework to follow in subsequent years.
The current system relies on T+2 settlement, a two-day gap between trade execution and the exchange of securities and cash. That window carries counterparty risk, ties up capital, and requires extensive back-office reconciliation. A 24/7 blockchain-based system would settle transactions in seconds, cutting risk and freeing collateral.
MUFG, Japan’s largest bank, announced a proof-of-concept in August 2026 for on-chain Japanese Government Bond repo transactions using the Canton Network. The system is designed to settle trades instantly around the clock, rather than only during traditional banking hours. Canton was built specifically for institutional finance, with privacy features that let counterparties share a ledger without exposing sensitive data to all participants.
MUFG carries an AlphaScala Alpha Score of 57 out of 100, labelled Moderate, and its stock page provides further detail. Mizuho and other banks are backing parallel plans for 24/7 JGB trading on blockchain infrastructure, with early frameworks taking shape as soon as 2026, banking sources said.
Nomura, working with the BOOSTRY platform, issued Japan’s first domestic digital bond in 2025. That bond featured delivery-versus-payment settlement with a T+1 cycle and carries a maturity date of March 2030.
The Bank of Japan is running its own parallel track. A sandbox program for blockchain-based interbank and securities settlements launched in 2026 and runs through 2028. Two years of controlled testing should generate enough data to confirm whether blockchain settlement can handle the volume, speed, and reliability requirements of one of the world’s largest bond markets, the BOJ said.
Major banks are also pushing for trading frameworks built around stablecoins, digital tokens pegged to fiat currency values. Stablecoin-denominated settlement would reduce friction and keep the entire trade lifecycle within a single technological environment, bankers involved in the discussions said.
Japan was one of the first countries to regulate crypto exchanges after the Mt. Gox collapse in 2014. The country’s aging population and shrinking workforce are also pressuring financial institutions to automate processes that currently require large back-office teams. Replacing manual settlement work with automated blockchain systems is a demographic necessity, not just a technology upgrade, officials said.
The study group’s composition, the FSA, Finance Ministry, and BOJ alongside private banks, means regulatory, monetary, and fiscal policy perspectives are being integrated from the start, rather than bolted on after the technology is developed.
The BOJ sandbox provides a natural checkpoint. By the end of 2028, the regulator will have two years of operational data to evaluate whether blockchain settlement can meet the demands of Japan’s equity and bond markets. The government aims to have the first real-time blockchain settlement systems operational by the early 2030s.
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