Mitsubishi UFJ Financial Group (MUFG) has launched a proof-of-concept to bring Japanese Government Bond (JGB) repo transactions on-chain, working with Digital Asset, Progmat and Secured Finance.
The initiative will use the Canton Network, a blockchain designed for institutional finance, to explore how JGB repos could be automated and settled digitally.
The PoC will examine simultaneous on-chain settlement of JGBs and digital money, including potential use of tokenised deposits or stablecoins. It will also explore automating the full repo transaction lifecycle through Secured Finance’s lending protocol.
MUFG expects the approach to improve operational efficiency while enabling real-time intraday repo transactions, potentially expanding settlement windows and improving funding and capital efficiency.
The project forms part of a series of pilot projects selected under Japan’s Financial Services Agency Payment Innovation Project. MUFG said it will work with regulators and market participants as it explores the potential for wider implementation.
