Japanese financial giant Sumitomo Mitsui has joined forces with Securitize to unveil Japan’s first security token in compliance with the country’s Financial Instruments and Exchange Act.
The issuance of the first asset-backed securities by SMTB marks the first such move of its kind, based on a release Tuesday by Securitize, a security tokens issuer and technology company.
Supporting the growth of digital tokens
The move is also expected to signal similar initiatives by other lenders in the coming weeks. Japan has historically backed the growth of the virtual token and blockchain market.
The token was given an “A-1” rating from the Japanese rating agency Rating and Investment Information, Inc, which suggests the product has a high possibility of attaining its short-term goals.
Sumitomo Mitsui holds more than $2 trillion in assets under management (AUM) and operates in more than 463 locations.
“Excited to share that Japan’s first credit-rated security token was launched today by Sumitomo Mitsui Trust Bank, the biggest trust bank in Japan,” CryptoSlate quoted Securitize as saying in a tweet.
Big-time investors
The token was made by tokenizing paper-based beneficiary certificates that represent investors holding to an existing asset. Sumitomo has also established a trust company to oversee its underlying securitized investments.
The US-headquartered Securitize has a Japanese unit and multiple high-profile Japanese investors. Some of the investors include MUFG, Nomura, Sony Financial Ventures, SBI, KDDI, and Mitsui Fudosan. The company is also teaming up with NTT Data on a security token platform and has rolled out a tokenized property solution.
Securitize allows companies to tap into capital markets by enabling virtual securities, which the company says can be easily owned and managed, and faster to trade than traditional equities. In March last year, Securitize collaborated with Tokyo-headquartered LIFULL to forge a tokenized property investment platform.
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