Progmat Inc., the infrastructure company behind 63% of Japan's security token issuance volume, is migrating ¥439.6 billion ($2.9 billion) in tokenized real estate and corporate bonds from the private Corda 5 ledger to a dedicated Avalanche Layer 1 blockchain. Completion is scheduled for end of Ju...
"We're moving Progmat ST from Corda5 to Avalanche, making all ST deals EVM-compatible and progressively permissionless." — Tatsuya Saito, CEO, Progmat Inc.
Progmat Inc., the infrastructure company behind 63% of Japan's security token issuance volume, is migrating ¥439.6 billion ($2.9 billion) in tokenized real estate and corporate bonds from the private Corda 5 ledger to a dedicated Avalanche Layer 1 blockchain. Completion is scheduled for end of June 2026. The move represents the largest single migration of regulated financial assets from a permissioned to a public blockchain environment on record.
The decision effectively sets the technical standard for Japan's digital securities market, which the Japan Security Token Association projects will exceed ¥1.05 trillion ($7 billion) by year-end 2026. Progmat holds 53.8% of all active security token projects in the country and has facilitated ¥216.9 billion in tokenized issuance to date, backed by shareholders including MUFG (49%), NTT Data (13.5%), SMBC (7.5%), Mizuho (7.5%), Sumitomo Mitsui Trust Bank (7.5%), Japan Exchange Group (5%), SBI PTS Holdings (5%), and Datachain (5%).
Progmat announced the platform migration on February 26, 2026. The transition began in fall 2025 and targets full completion by end of June 2026. All existing security token projects currently operating on Corda 5 will move to the new Avalanche L1. The SaaS application layers for issuers and administrators remain largely unchanged; only the underlying distributed ledger is being replaced.
Assets in scope:
Progmat completed its prior migration to Corda 5 SaaS as recently as October 2024—the first such migration in Asia. The decision to move again within 18 months signals a fundamental strategic shift from private distributed ledgers to public blockchain infrastructure.
The new infrastructure runs on a dedicated Avalanche L1 deployed through AvaCloud, providing:
The dedicated L1 structure allows Progmat to maintain regulatory compliance requirements (KYC/AML controls, permissioned validator sets for regulated activities) while gaining composability with the broader EVM ecosystem. This is a "gradually permissionless" model—institutional governance at the validator layer, open composability at the application layer.
The architecture contrasts with the Corda 5 environment, which offered transaction privacy and finality but lacked interoperability with public DeFi infrastructure and non-Corda counterparties.
Three factors drove the migration decision, according to available disclosures:
1. Liquidity Access. Corda's private architecture isolated Japanese security tokens from global capital pools. EVM compatibility on a public chain enables foreign institutional investors to access Japanese tokenized assets through standard wallet infrastructure for the first time.
2. Settlement Costs. Avalanche's sub-second finality enables near-instant Delivery versus Payment (DvP) settlement without reliance on centralized clearing intermediaries. This compresses the settlement value chain, reducing fees extracted by custodians, clearinghouses, and reconciliation services.
3. Composability. Public chain deployment allows security tokens to interact with DeFi lending protocols, stablecoin payment rails, and automated market makers—expanding the utility of tokenized securities beyond buy-and-hold custody.
The migration also coincides with CME Group's launch of regulated AVAX futures on May 7, 2026, with 24/7 trading scheduled to begin May 29, 2026—adding institutional hedging infrastructure for the underlying network token.
Concurrent with the migration, Progmat is commercializing cross-chain settlement services through an initiative internally named Project Keystone (previously disclosed as "Project Trinity" in August 2025 proof-of-concept phase).
The technical core is LCP (Light Client Proxy), a protocol developed with Datachain that runs on Trusted Execution Environments (TEEs). LCP enables:
The significance: Japan, the United States, Europe, and South Korea are each developing domestic stablecoins on separate ledger infrastructure. Without interoperability, cross-border settlement between these platforms remains blocked. Project Keystone positions Progmat as the settlement bridge between jurisdictional stablecoin silos.
The Avalanche migration aligns with Japan's broader push toward bank-issued stablecoins. In early 2026, Japan's Financial Services Agency (FSA) approved a stablecoin trial involving the country's three largest banks:
The initiative, dubbed the Payment Innovation Project (PIP), will issue a yen-pegged stablecoin on Progmat's platform. Mitsubishi Corp., the country's largest trading company, will be among the first large-scale users, deploying the token for internal settlements among its 200+ subsidiaries and for international remittances.
Targets disclosed:
The convergence of tokenized securities and bank-issued stablecoins on the same public chain infrastructure creates a vertically integrated capital market: issuance, trading, settlement, and payment all executing on-chain with sub-second finality.
For Japan's capital markets: Japan's digital securities market is on track to cross the ¥1 trillion threshold in 2026. The migration to public blockchain infrastructure opens this market to non-Japanese participants and enables 24/7 trading. Japan Exchange Group announced plans for 24/7 tokenized stock trading with minimum purchase sizes as low as ¥1, a structural departure from traditional exchange hours and lot sizes.
MUFG's March 2026 launch of the ¥22.4 billion (~$142 million) Osaka Dojimahama Tower real estate security token—one of the largest single issuances to date—demonstrates the asset classes flowing onto this infrastructure.
For Avalanche's network: The Progmat migration represents a contractual commitment from Japan's largest financial institutions to build on Avalanche infrastructure. AVAX traded near $8.50-$9.28 in May 2026, suggesting the market has not priced in the full operational scale of the migration. The CME futures launch adds a hedging layer for institutions with exposure to the network.
For the private-to-public chain thesis: Progmat's decision to abandon Corda after completing a Corda 5 migration just 18 months earlier is a data point against enterprise-grade private blockchains as long-term infrastructure for tokenized securities. The implied conclusion: regulatory compliance can coexist with public chain deployment through architectural design (permissioned validators, dedicated L1s), without requiring a fully private ledger.
Progmat's migration is a stress test for the thesis that regulated financial instruments can operate on public blockchain infrastructure without sacrificing compliance. The answer, according to Japan's largest financial institutions, is yes—provided the architecture segregates governance (permissioned validators) from composability (EVM-compatible application layer).
The economic logic is straightforward: private chains offered privacy and control but imposed liquidity isolation and interoperability costs that exceeded the regulatory comfort they provided. Public chains with institutional governance layers offer the compliance surface area regulators require while removing the capital formation ceiling that private networks impose.
If the June 2026 completion target holds, Japan will have the world's largest regulated securities market operating on public blockchain infrastructure—a reference architecture that other jurisdictions will be forced to evaluate.