Use of blockchain for trading shares in Japan to be explored in 'proof of concept' tests

The Japan Exchange Group (JPX) said it will work with IBM on "proof of concept tests … to evaluate the limits and possibilities of the technology in markets that have low transaction data volume".

In a statement JPX said: "Blockchain technology is gaining attention worldwide as one of the most promising aspects of fintech that could be applied to constructing shared infrastructure to provide high availability and reliability at low cost. However, there are issues to be resolved in the technology, and it will need to be continually verified and improved before actual application in financial business operations."

IBM said that the tests will make use of blockchain code that it has made available to Linux Foundation's open source Hyperledger Project. 

IBM is already working with the London Stock Exchange on exploring the use of blockchain technology.

Moiz Kohari, executive vice president and group head of technology innovation at London Stock Exchange Group, said that blockchain could "help manage risk and bring additional transparency to global financial markets".

"We believe this technology has the potential to drive change across the industry but will need to be developed in partnership with customers and industry participants under an open source approach," Kohari said.

IBM has separately announced that it will open 'IBM Garages' in London, New York, Singapore and Tokyo "to help accelerate the design and development of blockchain applications". These facilities will "enable IBM experts to collaborate with developers on the design and implementation of blockchain for business", it said.

Earlier this year New York’s Nasdaq stock market said it had successfully used blockchain ledger technology to complete and record a private securities transaction. It said it was the first transaction of its kind using blockchain technology.