Progmat Pivots to Public Chain: Migrates 440 Billion Yen in Security Token Assets to Avalanche
Progmat has entered into a strategic partnership with Ava Labs (Avalanche) and blockchain interoperability startup Datachain, aiming to accelerate the "financial on-chain" ecosystem by migrating Progmat’s Security Token (ST) platform from a private ledger to the Avalanche public blockchain ecosystem.
From Private Consortium to Public Ecosystem
Progmat, which holds the top market share in Japan for security tokens, revealed it will transition its "Progmat ST" issuance and management infrastructure from the enterprise-focused "Corda 5" private ledger to "Avalanche L1" (formerly known as Subnets).
This migration represents a significant pivot for the Japanese financial sector. By moving all issued security token projects—valued at over 439.6 billion JPY as of the time of writing—to an EVM (Ethereum Virtual Machine) compatible environment, Progmat aims to tap into the global pool of "on-chain investors" and enhance composability with decentralized finance (DeFi) protocols, all while maintaining the strict compliance controls required by financial institutions.
Solving the Liquidity Fragmention with Cross-Chain Tech
A core component of this partnership is the integration of Datachain’s cross-chain technology. As financial markets fragment across various private and public blockchains, liquidity silos have become a pressing issue.
Datachain will deploy its "LCP" (Light Client Proxy) solution, which utilizes Trusted Execution Environments (TEE) to facilitate secure, high-speed data verification. This infrastructure will enable Delivery versus Payment (DvP) settlements between Security Tokens on Avalanche L1 and Stablecoins (SC) issued on other blockchains, as well as Payment versus Payment (PvP) between different Stablecoins.
Market Context: The Race for Open Finance
The backdrop for this decision is the rapid expansion of the ST market, projected to reach over 1.5 trillion JPY by 2026. While the market was initially dominated by real estate-backed tokens, there is a growing shift toward tokenized bonds, investment trusts, and equities.
Simultaneously, global players like BlackRock and Ondo Finance have demonstrated the liquidity benefits of deploying assets on public blockchains. Japan’s domestic market faces a similar imperative: to move beyond closed consortiums and integrate with the global, open blockchain standard to attract broader investment liquidity.
Timeline and Outlook
Progmat expects to complete the "Avalanche L1" compatibility update for its ST base by the end of June 2026. The rollout of cross-chain services will follow, coinciding with commercial project releases.
This collaboration effectively bridges the gap between Japan’s highly regulated financial institutions and the permissionless innovation of the public blockchain world, potentially setting a new standard for how traditional finance (TradFi) operates on-chain.
Norbert Gehrke
