Capital markets News

Nomura Research issues first Japanese blockchain bonds, forms research consortium


Today Nomura Research Institute (NRI) offered the first Japanese blockchain-based digital bonds directly to investors. Last year NRI and Nomura Holdings created a joint venture BOOSTRY to develop a tokenized asset platform called ibet.

Two bonds were issued, with one of them referred to as a digital asset bond. Instead of paying interest, it provided redeemable points – the digital asset – for buying coffee. This was a 25 million yen ($232,000) bond with a three month maturity. The second five million yen bond was more conventional, offering a low interest rate.

Usually, issuing corporate bonds is a costly process involving significant admin. By using a blockchain, it lowers the barriers to entry and can make smaller bond denominations more viable. It also introduces the possibility of innovation, as demonstrated by the digital asset bond. 

For both of the issues, Nomura Securities acted as the underwriter and BOOSTRY was the registry agent.

Apart from its involvement with BOOSTRY, earlier this year Nomura Research also created a cryptocurrency index bearing its name.

There have been numerous blockchain-based bond issuances around the world, including by the World Bank, Russia’s Sberbank, as well as Societe Generale and Santander, which used a public blockchain.

New blockchain research group

Also today, Nomura Institute of Capital Markets Research announced a new research consortium focused on blockchain technology in financial markets, including security token offerings (STO).

Later this year, the Financial Instruments and Exchange Act will clarify the legal treatment of STOs and rights transferrable using distributed ledger technology (DLT). 

To research the issues, the group plans to bring together academics and market participants such as issuers, asset managers, settlement agencies, and other financial intermediaries.

The full research group includes Anderson, Mori & Tomotsune, JCB, Daiichi Life Insurance, Tokio Marine & Nichido Fire Insurance, Nishimura & Asahi, NTT, Nomura Asset Management, Nomura Institute of Capital Markets Research, Nomura Securities, Nomura Trust and Banking, Nomura Research Institute, BOOSTRY, Fujitsu, Mitsui and Mitsui Fudosan.

NTT is also a participant in another Japanese group, the Security Token Research Consortium initiated by MUFG, which includes Mitsubishi, Accenture, KPMG and startup Securitize.

Additionally, there’s a Japan Security Token Offering Association, which aims to develop a self-regulation framework. Initiated by Monex, it includes Nomura Securities, SBI Securities, Daiwa Securities and Rakuten Securities.