Japan is set to begin work on a next-generation payment infrastructure, with an initial goal of enabling the instantaneous settlement of transactions in stocks and Japanese government bonds at any time of day using blockchain technology, Nikkei reports

Japan is set to begin work on a next-generation payment infrastructure, with an initial goal of enabling the instantaneous settlement of transactions in stocks and Japanese government bonds at any time of day using blockchain technology, Nikkei reports.

Post-trade infrastructure projects of this kind have been floated repeatedly by major markets, and the established pattern is a long gestation: pilot schemes, limited-scope trials with a handful of participants, then years of coexistence with legacy rails before any migration of real volume. The operative mechanism here is settlement finality and the compression of the settlement cycle; moving JGB and equity settlement toward atomic, round-the-clock delivery-versus-payment would in principle cut counterparty exposure and free collateral currently tied up between trade and settlement, which matters most in the repo market where JGBs are the core collateral. The actors worth identifying are the convening body, whether this is a BOJ-led, exchange-led, or private consortium effort, since central bank sponsorship has historically determined whether such projects reach production or stall as proofs of concept. The Nikkei-sourced, 'set to begin work' framing signals an early-stage initiative rather than an imminent change to market plumbing. Follow-ons to note are any tie-in with work on a wholesale central bank digital currency, the treatment of the existing settlement windows and net liquidity facilities, and whether foreign participants in the JGB market are included, which has tended to be the sticking point in past reforms of Japanese market infrastructure.