Zenith Joins Japan Tokenized JGB Group, Expands Work With Major Banks
Summary
- Zenith said it has joined the Tokenized JGB and On-Chain Repo Working Group, expanding cooperation with major Japanese banks to tokenize Japanese government bonds, or JGBs.
- The group said it aims to tokenize JGBs and build stablecoin-based on-chain repo infrastructure that enables instant settlement, 24-hour trading and broader global access.
- Zenith said it plans to contribute to an effort to reshape liquidity in Japan's roughly $1.6 trillion JGB repo market and expand Japan's tokenized securities market into institutional government bond tokenization.
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Zenith, a Canton Network-based Ethereum Virtual Machine-compatible project, is expanding collaboration with major Japanese banks on the tokenization of Japanese government bonds, or JGBs.
The company said June 24 that it had joined the Tokenized JGB and On-Chain Repo Working Group. The group was established last month to explore tokenizing JGBs and moving stablecoin-based repo transactions backed by those bonds on-chain.
The working group was launched under Japan's Digital Asset Co-Creation Consortium, or DCC. Participants include Mitsubishi UFJ Bank, Mizuho Bank, Sumitomo Mitsui Banking Corp., SBI Securities, BlackRock Japan and Market Innovation & Research, a unit of Japan Exchange Group.
The group's central goal is to build institutional on-chain repo infrastructure using tokenized JGBs. The plan calls for instant settlement, 24-hour trading and broader global access in the JGB repo market.
The consortium sees tokenization as a way to create new liquidity in Japan's government bond market. Zenith estimates the JGB repo market at about $1.6 trillion, or roughly 10% of the global sovereign bond repo market.
Cumulative issuance of tokenized securities in Japan has already surpassed $2.2 billion. A Zenith official said issuance in Japan has so far centered on real estate, and that the working group is an attempt to expand the country's tokenized securities market into institutional government bond tokenization.
The group plans to publish a comprehensive report on its findings in October. It also aims to launch a pilot program for JGB tokenization later this year. Zenith said it will contribute to protocol design and the development of compliant infrastructure.
Heslin Kim, Zenith's co-founder and chief business officer, said he was pleased to join the working group alongside Japan's financial industry to tokenize JGBs. He called the partnership one of the front lines in the push to bring real-world assets on-chain.
He added that the initiative could reshape liquidity in Japan's $1.6 trillion JGB repo market for global investors.
JOON HYOUNG LEE
gilson@bloomingbit.ioCrypto Journalist based in Seoul
