Japan plans blockchain settlement for its $7 trillion bond market

Japan is planning blockchain settlement for stocks and Japanese government bonds. Nikkei reported that regulators want the assets to settle instantly around the clock. The Financial Services Agency, the Ministry of Finance, and the Bank of Japan are expected to lead the work. Banks will join them in a study group. The group is expected to produce a development plan by early 2027. The system could begin operating in the early 2030s. Tokyo stock trades currently take two days to settle. Japanese government bond trades currently take one day to settle. The proposed system could reduce settlement time to near zero. Sellers could reinvest cash almost instantly. Japan has roughly 1,166 trillion yen in outstanding government bonds and bills. That amount equals about $7 trillion at current exchange rates. Japan first reduced Japanese government bond settlement to one day in 2018. Japan reduced stock settlement to two days in 2019. The United States reduced stock settlement to one day in 2024. Four of Japan's biggest lenders have run a blockchain collateral trial for Japanese government bonds since April 2026. SBI and the Solana Foundation are developing yen stablecoin applications for Japan's on-chain finance sector. The 10-year Japanese government bond yield is near 2.9%. The 30-year yield is above 4%. Markets see an 80% chance of a Bank of Japan rate hike next month. The yen is trading near 159 per dollar. Japan and the United States confirmed their first joint yen-buying intervention since 2011 in early August. The plan still requires formal approval. The launch remains years away.