Japan's Largest Bank MUFG Purchases Osaka High-Rise Worth 100 Billion Yen, Issuing Digital Securities for Individual and Institutional Investors.
The asset tokenization market in Japan marks an important milestone as Mitsubishi UFJ Trust and Banking, the trust division of the MUFG financial group, acquires a high-rise building in Osaka for over 100 billion Yen. According to the plan, MUFG will use this asset to issue digital securities and sell real estate in a tokenized form for both individual and institutional investors.
With a transaction value equivalent to 681 million USD, this is one of the largest real estate tokenization projects in the Japanese market. MUFG's distribution strategy is designed with a dual approach: the asset will be distributed to life insurance companies in the form of private real estate investment trusts, while individual investors can access it through real estate tokens.
Unlike Europe, where digital bonds are the prevalent tokenization form, the Japanese market focuses primarily on real estate tokenization. However, this market is still in its early stages, reflected by secondary trading activities on the Osaka Digital Exchange's START platform, with only six real estate tokens listed and a modest monthly trading volume of around 23 million Yen.
Japan's Digital Securities Market Develops Steadily
Since the first digital securities issuance in 2021, Japan has recorded 63 issuances with a total value of 194 billion Yen. Of these, approximately 20% are bonds, with the remainder primarily being tokenized real estate products, indicating a clear market preference for this asset type.
Mitsui Digital Asset Management leads in real estate tokenization through the Alterna platform, directly issuing real estate tokens to individual investors. An estimated 14 out of 16 of Mitsui's issuances were made through Alterna, highlighting the platform's importance in connecting individual investors with the tokenized real estate market.
Previously, Mitsui collaborated with MUFG Trust to establish the necessary trust structure for real estate tokenization. However, to shorten issuance time, Mitsui has built its own Alterna Trust structure, creating direct competition with MUFG Trust.
Despite direct competition, the two companies maintain an indirect relationship through Progmat – MUFG's digital securities platform. Although MUFG has successfully spun off Progmat as an independent company, they still hold 42% of shares. Mitsui recently signed an agreement to continue using Progmat for most of its securities tokens, indicating that the strategic connection is maintained at the technological infrastructure level.
