A Japanese bank launches the first ‘a-1’ rated security token

Sumitomo Mitsui Trust Bank (SMBT), a bank based in Japan has created its first asset-backed securities token on March 29. The token was created in partnership with a tokenization platform Securitize.

This is the first security token compliant with the Financial Instruments and Exchange Act to launch in the Japanese Market. Along with the “a-1 rating” backed by the Rating and Investment Information, A Japanese rating agency, the token is expected to fulfil its short-term obligations.

The creation of the token includes tokenizing paper-based beneficiary certificates representing investor ownership to an underlying asset. To manage the following investments, The bank has created a trusted company.

SMBT is a member of the Japan Security Token Association alongside regional giants like NTT and Softbank. The firm had been exploring Blockchain since October 2016 in a team-up with IBM. Their aim was to explore Distributed Ledger Technology (DLT) to improve the efficiency of its asset management, real estate and banking businesses.

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