JPX and Other Companies Partner to Issue Japan's First Wholesale Digitally Tracked Green Bond

Japan Exchange Group, Inc., Hitachi Ltd., Nomura Securities Co., Ltd, and BOOSTRY Co., Ltd. today announce their cooperation in the issuance of a publicly-offered wholesale "Digitally Tracked Green Bond", the first in Japan, using a corporate bond-type security tokens scheme that utilizes a blockchain provided by BOOSTRY.

The digital bond will be in the form of a publicly offered STO (Security Token Offering) issued by JPX. An STO is a scheme to raise funds using "security tokens", which are tokens issued by electronic means such as blockchain that represent stocks, bonds, or other securities, in place of conventional securities.

Amendments to the Financial Instruments and Exchange Act and the corresponding amendments to ministerial ordinances that came into effect on May 1, 2020, defined such digital bonds as "electronically recorded transferable rights to be indicated on securities, etc.," enabling their use under laws and regulations. This digital bond will be the first issued for wholesale trading in Japan.

Being able to measure the effects of invested projects on the environment and society, and represent these with comparable metrics, is considered very beneficial to the green and other ESG bond markets.

The Digitally Tracked Green Bond is a bond aimed at utilizing digital technologies to tackle issues that have long been recognized by both issuers and investors of green bonds, namely the lack of transparency of data needed for green investment and the complexity of gathering that data, by increasing efficiency in data collection and improving transparency. Through this scheme, the companies aim to contribute to carbon neutrality in society as a whole by providing a highly convenient product that can be used by many issuers and investors.