Japan Securities Clearing Corporation (JSCC), part of Japan Exchange Group (JPX), will run a proof of concept with Mizuho Financial Group, Nomura Holdings and Digital Asset to test Japanese Government Bonds (JGBs) as digital collateral on the Canton Network.
The project will assess whether JGBs can be transferred and managed onchain while preserving their legal status under Japan’s Book-Entry Transfer Act and the Financial Instruments and Exchange Act. It will also test whether integrating existing systems with Canton’s blockchain infrastructure can enable more sophisticated, real-time collateral transactions operating 24/7, including cross-border cases.
Japan’s Financial Services Agency selected the initiative in February for support through its Payment Innovation Project within the FinTech PoC Hub. The trial positions one of the world’s largest sovereign bond markets in ongoing discussions about moving collateral more efficiently across digital market infrastructure without undermining current legal and supervisory frameworks. No commercial rollout has been announced.
An earlier Canton pilot in December 2025 demonstrated tokenized US Treasuries being reused as collateral in real time among major dealers and market participants, including Bank of America and Société Générale. Those tests highlighted the potential to reuse high-grade government securities onchain across multiple participants; the new JGB trial extends that approach to Japan’s sovereign bond market.
Separately, the UK government appointed HSBC’s Orion platform in February to host issuance for its Digital Gilt Instrument pilot in the Bank of England’s Digital Securities Sandbox as it explores distributed ledger technology for sovereign debt.
Cointelegraph contacted JSCC and Digital Asset for comment but had not received responses by publication.
