To celebrate its 100th anniversary, Japan’s Okasan Securities plans to issue a digital bond of up to Yen 2 billion ($13.4m) to retail investors in late December. It will use the Progmat security token platform founded by MUFG. Okasan Securities’ market capitalization is just over $1.1 billion and has an asset management joint venture with SBI, unrelated to digital securities.
Like other digital securities issuances, there’s no need to use a central securities depository as Progmat acts as the bond registry. Mizuho Securities is co-underwriting the bond with Okasan. Mizuho Bank will act as bond manager and the custodian is MUFG.
Consumers can subscribe to the one year bond in units of one million yen ($6,700). The securities firm claims this is the largest retail bond issuance to date. There have been other consumer focused security tokens, but most have been real estate based.
This will be the 17th security token issued on the Progmat platform, where the issuance is approaching $590 million.
Progmat is a tokenization platform co-owned by banks and stock exchanges. It incorporated in October, with MUFG retaining a 49% stake. MUFG’s shareholding is deliberately less than 50% to reduce the perception that the platform is under its control. Other shareholders include Japan’s second and third largest banks, SMBC (7.5%) and Mizuho (7.5%) as well as Sumitomo Mitsui Trust Bank (7.5%). Tokyo Stock Exchange operator JPX owns 5%, as does SBI PTS Holdings, the owner of the Osaka Digital Exchange (ODX). Other stockholders are technology providers NTT Data (13.5%) and Datachain (5%).
In addition to digital securities, the Progmat platform also supports utility tokens and stablecoins. MUFG recently disclosed plans about Binance looking to issue a stablecoin in Japan. And DRW Cumberland is participating in an experiment for a stablecoin to settle institutional cryptocurrency transactions.
