MUFG participates in funding for Progmat's digital securities, explanations for reasons provided
Japan's digital securities platform Progmat has announced a new funding round, welcoming three new investors: Nochun Trust and Banking (MUFG’s trust banking unit), Aozora Bank, and real estate firm Kenedix. This significant investment is set to impact Progmat's shareholding and expansion plans, anchoring large-scale real estate tokenization projects and strengthening the platform's institutional backing and market reach.
MUFG's Strategic Investment and Partnership
MUFG, through its trust banking unit, now holds a major share (42%) in Progmat. This strategic investment underscores the platform’s importance and long-term growth in Japan’s digital securities market. MUFG's collaboration with Kenedix to manage a landmark tokenization project—the fractional ownership offering of a ¥100 billion Osaka skyscraper—has positioned Progmat at the centre of real estate tokenization innovation in Japan. This partnership enhances Progmat's credibility and expands its real estate asset base.
Broadening Market Participation
By enabling both institutional investors (such as life insurers via private REITs) and retail investors access to tokenized real estate assets, Progmat's expansion plan moves toward democratizing asset ownership and broadening market participation. This move is expected to create a more liquid, transparent, and operationally efficient digital securities market in Japan, leveraging blockchain technology to overcome traditional barriers in real estate investment and securities issuance.
Aozora Bank's Collaboration
Aozora Bank’s involvement, though less detailed in the sources, is part of a broader collaboration with MUFG-backed platforms, reinforcing a cooperative ecosystem for digital securities infrastructure development across Japanese financial institutions.
Progmat's Future Plans
The new investors' involvement could pave the way for the inclusion of securities firms in Progmat's shareholding in the future. Progmat Coin, acting as a stablecoin issuance platform with reserves held by one of the associated trust banks, is another area of focus for the platform. Progmat is also exploring the potential of stablecoins in cross-border payments, with the big three Japanese banks working on this together in September 2024.
Expanding Beyond Japan
Progmat CEO Tatsuya Saito stated that the platform aims to expand beyond Japan. Kenedix, one of the new investors, plans to launch a mobile app dedicated to security tokens, offering utility tokens and stablecoins to its investors, both areas within Progmat's remit. Aozora Bank believes that Progmat's global expansion efforts will contribute greatly to the development of the digital asset market.
Tatsuya Saito's strategies with Progmat, as outlined in his blog post, may be useful for anyone trying to push innovation from within a bank. The funding round diluted MUFG's shareholding in Progmat from 49% to 42%. SBI is represented by SBI PTS in Progmat's shareholding, rather than SBI Securities. Stablecoins, according to Progmat, can provide certainty around the timing of payments, can be automated using smart contracts, and are particularly appropriate for the settlement of digital securities.
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- The trust banking unit of MUFG, Japan's leading bank, now holds a significant stake (42%) in the digital securities platform Progmat, signifying a strategic long-term commitment to the growth of the digital securities market.
- The partnership between Progmat, Kenedix, and MUFG has kickstarted the tokenization of a ¥100 billion Osaka skyscraper, positioning Progmat at the forefront of real estate tokenization in Japan and boosting its credibility in the industry.
- Aozora Bank, another new investor in Progmat, is working closely with MUFG-backed platforms to foster a collaborative ecosystem for the development of digital securities infrastructure across Japanese financial institutions.
- Progmat's future plans include enlarging its investor base to include securities firms, issuing stablecoins through its Progmat Coin platform, and exploring the potential of stablecoins in cross-border payments, with a joint initiative planned for September 2024 with the big three Japanese banks.
- Progmat, under the leadership of Tatsuya Saito, aims to expand beyond Japan's borders, and Kenedix, one of the new investors, will soon launch a mobile app dedicated to security tokens, offering not only utility tokens but also stablecoins to its investors, bolstering the global growth of the digital asset market.
