SBI Holdings is set to digitize Japanese equities with blockchain to lower fees and facilitate quicker global trading.
Japan’s leading financial group, SBI Holdings, is launching a joint venture with Singaporean startup StarTail Group. Together, they will create a blockchain-based platform to digitize equities. Sources informed TV Tokyo that this project could lower trading fees and make Japanese stocks more accessible on a global scale.
SBI Ventures into Stock Tokenization
Through this initiative, SBI will transform shares into “tokens,” a type of digital asset, potentially eliminating the need for traditional brokers. This innovation could reduce transaction times to mere seconds and significantly lower costs. Moreover, it would reduce barriers for global investors, enhancing participation in Japanese equity markets.
While cryptocurrencies are criticized for their volatility, tokenized shares will reflect stock prices and returns, providing a more stable alternative to traditional digital assets. SBI intends to extend tokenization beyond equities to encompass bonds and ETFs, fostering the creation of a holistic digital financial platform. The company aims to introduce tokenized stocks by late 2026 or early 2027.
As of March 2024, SBI’s banking and securities sectors boasted a substantial client base of approximately 50 million accounts. By leveraging this clientele, the company aspires to enhance access to digital asset trading. Chairman and CEO Yoshitaka Kitao sees this initiative as a major stride toward incorporating traditional finance with digital technologies.
Global Tokenization Trends
Tokenization of stocks is already progressing in the United States. In June, online broker Robinhood and cryptocurrency exchange Kraken revealed intentions to launch tokenized US stocks and ETFs on blockchain platforms. During former President Trump’s administration, the US Securities and Exchange Commission clarified the status of digital assets as securities. Consequently, tokenized equity markets are gaining momentum.
In Japan, regulatory discussions surrounding tokenized stocks are still nascent. Recently, the government sanctioned the first issuance of fiat-backed stablecoins. SBI plans to showcase its blockchain-based trading infrastructure at the WEBX crypto event commencing August 22. Executive leaders regard this initiative as a pivotal chance to transform digital finance, aspiring to position SBI as a global leader in the space.
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