MUFG participates in Progmat's digital securities funding round; reasons explained
Progmat, a digital securities platform, has announced a new funding round with three new investors: Nochun Trust and Banking, Aozora Bank, and real estate firm Kenedix. This latest development marks a significant step forward in Japan's digital securities market, enabling fractional ownership of real estate through blockchain-based REITs [1][3][5].
The expansion, led by MUFG's tokenization of a ¥100 billion ($681 million) Osaka skyscraper, represents a major shift in the industry. Progmat's CEO and founder, Tatsuya Saito, stated that they aim to expand the platform beyond Japan [3].
The vibrant blue colour of Progmat's branding, a deliberate choice by Saito to contrast with MUFG's red, symbolises the fresh approach the platform brings to the market [3].
Nochun Trust Bank is looking to use tokenization to expand the market for certain assets that were previously only available to institutional investors. They are also interested in the tokenization of commodities from the agriculture, forestry, and fishery sectors [3].
Kenedix, one of Japan's largest real estate asset managers, plans to launch a mobile app dedicated to security tokens, offering utility tokens and stablecoins to its investors [3]. They have been involved in several tokenized real estate issuances and are the primary competitor to Progmat in the Japanese market [3].
Aozora Bank, with its experience in bond issuance, LBO finance, and real estate, among other areas, brings valuable expertise to the table [3].
The rising focus on tokenized property through platforms like Progmat contrasts with iBet for Fin's bond issuance emphasis, showing differentiated strategic niches within Japan's digital asset market [2].
Mitsui Digital Asset Management’s Alterna, another player in the market, also focuses on tokenized real estate but has recently pursued operational independence by establishing its own legal backend, Alterna Trust [2]. However, Mitsui maintains use of Progmat for most tokens, indicating a hybrid competitive-cooperative landscape rather than a clear-cut rivalry [2].
BOOSTRY’s iBet for Fin platform is another player in Japan’s digital securities ecosystem, primarily targeting digital bonds rather than real estate tokenization [2].
The potential for stablecoins in cross-border payments is being explored by Progmat, in collaboration with the big three Japanese banks [3].
The current shareholding of Progmat is neutral, with no securities firms investing so far [4]. Plans to include securities firms in Progmat's future shareholding are indicated by the diagram about the shareholdings [4].
With this latest funding, MUFG's shareholding in Progmat was diluted from 49% to 42% [4]. The Progmat digital securities platform was initially proposed within MUFG as a survival strategy, rather than a new revenue opportunity [6]. Venture capital firms were not courted as investors for Progmat, given its expected time to scale and the motivations behind it [6].
Progmat Coin acts as a stablecoin issuance platform, with the reserves held by one of the associated trust banks [4]. SBI is represented by SBI PTS, the company that owns the Osaka Digital Exchange (ODX), rather than SBI Securities, in Progmat's shareholding [4].
In summary, Progmat’s expansion, under MUFG’s leadership, has fostered greater institutional and retail participation in real estate tokenization, enhanced the infrastructure for Japanese digital securities, and positioned the platform as a key hub in a competitive yet interconnected market involving players such as Mitsui and BOOSTRY’s iBet for Fin platform [1][2][3].
[1] https://www.bloomberg.com/news/articles/2021-04-13/mu-fg-to-tokenize-100-billion-osaka-skyscraper-in-japan-first [2] https://www.coindesk.com/business/2021/03/31/japan-s-mitsui-bank-launches-real-estate-tokenization-platform-alterna/ [3] https://www.coindesk.com/business/2021/04/13/mufg-and-progmat-tokenize-100-billion-osaka-skyscraper-in-japan-first/ [4] https://www.coindesk.com/business/2021/04/13/progmat-raises-funds-to-expand-japanese-tokenized-real-estate-market/ [5] https://www.finextra.com/newsarticle/36634/progmat-and-mufg-tokenize-100-billion-osaka-skyscraper-to-boost-japans-digital-securities-market [6] https://www.coindesk.com/business/2021/04/13/progmat-raises-funds-to-expand-japanese-tokenized-real-estate-market/
- Progmat, a digital securities platform, aims to expand beyond Japan, seeking to leverage tokenization for assets such as real estate, commodities, and more, following the successful tokenization of a ¥100 billion ($681 million) Osaka skyscraper led by MUFG.
- Nochun Trust Bank, an investor in Progmat's latest funding round, intends to use tokenization to open up certain assets, previously exclusive to institutional investors, to a broader market, including assets from the agriculture, forestry, and fishery sectors.
- Kenedix, another investor, plans to launch a mobile app dedicated to security tokens, offering utility tokens and stablecoins to its investors, and has been involved in several tokenized real estate issuances, positioning itself as a primary competitor to Progmat in the Japanese market.
- Aozora Bank, with its extensive experience in various financial areas, brings valuable expertise to Progmat, contributing to the platform's growth and development.
- The Progmat digital securities platform is exploring the potential of stablecoins in cross-border payments, collaborating with the big three Japanese banks to capitalize on this opportunity.
