The Japanese government has just announced a major move—planning to fully digitize local government bonds and migrate them onto the blockchain by 2026. It may sound a bit distant, but the impact of this development could be much broader than you think.

First, let's talk about what this plan can bring: traditional bond issuance processes have always been cumbersome and inefficient. Digitization will significantly speed up issuance. Investors will be able to see the specific flow of funds in real-time, greatly increasing transparency. More importantly, retail investors will finally be able to participate directly, lowering the participation barrier from institutional level to individual level.

What’s even more noteworthy is the subsequent political push. The Japanese National Diet has already confirmed that it will promote relevant special legislation before 2026 to support this transformation. Once this model is successfully implemented in Japan, the international market may follow suit. Once trillions of government assets start flowing on the chain, the boundaries between traditional finance and the blockchain world will become increasingly blurred.

From a broader macro perspective, the digitization of sovereign assets is becoming a new global track. Fields like bond tokenization and RWA (Real-World Asset on-chain) may be brewing a historic opportunity. The key question is—will other countries follow suit? Is on-chain transformation of traditional finance a trend or a bubble? The answers may emerge in the next few years.