Japan’s first digital securities will start trading on Dec. 25 on Osaka Digital Exchange, a new platform backed by SBI Holdings Inc. and Sumitomo Mitsui Financial Group Inc.

The first issuer of securitization tokens in Japan

The securities are securitization tokens issued by Ichigo Inc., a Tokyo-based real estate investment company, representing about $20.1 million in assets backed by its property portfolio. The tokens use blockchain technology to enable faster and cheaper transactions, as well as to comply with regulations.

Ichigo is the first issuer of securitization tokens in Japan, following the revision of the Financial Instruments and Exchange Act in April that recognized digital securities as a legal form of securities. The company said it aims to provide more liquidity and transparency to the real estate market, as well as to diversify its funding sources.

A potential game-changer for the capital market

Osaka Digital Exchange, or ODX, is a joint venture between SBI and SMFG that operates a proprietary trading system for stocks and a secondary market for security tokens. The exchange said it plans to list more digital securities in the future, including those backed by other types of assets, such as bonds, funds, and intellectual property.

Digital securities are seen as a potential game-changer for the capital market, as they offer more efficiency, security, and accessibility than traditional securities. According to a report by PwC, the global market for security tokens could reach $1.7 trillion by 2025.