SBI to Launch Blockchain-Based Stock Tokenization Platform

SBI Holdings is moving to digitize Japanese equities using blockchain to cut fees and enable faster global trading.

Japan’s primary financial group, SBI Holdings, is preparing a joint venture with Singapore-based startup StarTail Group. Together, they will develop a blockchain-powered platform to digitize equities. Sources told TV Tokyo that the project could reduce trading fees and make Japanese stocks easier to access internationally.

SBI Ventures into Stock Tokenization

Under this system, SBI will convert shares into “tokens,” a digital asset, so traditional brokers may no longer be required. This could cut transaction times to a few seconds and significantly reduce costs. Additionally, global investors would face fewer hurdles, broadening participation in Japanese equity markets.

While cryptocurrencies are blamed for their high volatility, tokenized shares will mirror stock prices and yields. Therefore, they offer a more stable alternative to conventional digital assets. SBI plans to expand tokenization beyond equities to include bonds and ETFs. This strategy will help create a comprehensive digital financial platform. The company targets the market launch of tokenized stocks by late 2026 or early 2027.

As of March 2024, SBI’s banking and securities divisions had a strong customer base of roughly 50 million accounts. By leveraging these clients, the company aims to increase accessibility to digital asset trading. Chairman and CEO Yoshitaka Kitao views this move as a significant step toward integrating traditional finance with digital technology.

Global Tokenization Trends

Stock tokenization is already advancing in the United States. In June, online broker Robinhood and cryptocurrency exchange Kraken announced plans to issue tokenized US stocks and ETFs on blockchain platforms. Under former President Trump’s leadership, the US Securities and Exchange Commission provided guidance on whether digital assets qualify as securities. As a result, tokenized equity markets are gaining traction.

In Japan, regulatory discussions about tokenized stocks are still in the early stages. Recently, the government approved the first issuance of fiat-backed stablecoins. SBI will present its blockchain-based trading infrastructure at the WEBX crypto event starting August 22. Executives describe this initiative as a prime opportunity to reshape digital finance. Furthermore, it aims to position SBI as a global platform leader.