JPMorgan Plans Real-Time Blockchain Settlement Test for Japanese Government Bonds
Summary
- JPMorgan is planning to test Japanese government bond trading in real time on a blockchain.
- JPMorgan expects a blockchain-based system to shorten settlement times for government bond trades and improve repurchase agreement (RP) trading efficiency.
- Mitsubishi UFJ Financial Group (MUFG) also plans to pursue a proof of concept using the Canton Network (CC) for on-chain trading of Japanese government bonds.
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JPMorgan is planning to test real-time blockchain-based execution and settlement of Japanese government bond trades.
BlockBeats reported on August 13 that the bank will trial a blockchain-based system for processing Japanese government bond transactions.
JPMorgan sees blockchain as a way to shorten settlement times for government bond trades. It also expects the technology to improve the efficiency of repurchase agreement, or repo, transactions, in which funds are borrowed and repaid against government bonds posted as collateral.
Japanese government bond trades now typically take one to three business days to settle. A blockchain-based system could enable real-time settlement around the clock, including on weekends and at night.
Mitsubishi UFJ Financial Group Inc. is preparing a similar experiment. MUFG plans a proof of concept for on-chain trading of Japanese government bonds using the Canton Network.
JOON HYOUNG LEE
gilson@bloomingbit.ioCrypto Journalist based in Seoul