[Japan Ministry of Finance Proposes 'Three Types' of Tokenized Government Bonds] According to NADA NEWS, the Japan Ministry of Finance held the first meeting of the 'Government Bond Blockchain Research Group' today and released explanatory materials, categorizing the tokenization of government bonds into three types. Type 1 involves circulating the beneficiary rights of funds investing in government bonds (MMF) on the blockchain. Type 2 refers to integrating the transfer ledger into the blockchain under the current transfer settlement system, with three forms: single-account management institutions, multi-institution collaboration, and integration with the Bank of Japan's ledger. Type 3 entails issuing new forms of government bonds on a blockchain outside the current system. The Ministry of Finance believes that blockchain integration can enhance the efficiency of collateral and liquidity management, expand the investor base—particularly benefiting overseas investors—but also highlighted challenges such as market fragmentation, the transmission of sharp price fluctuations, and system transformation costs. The three types are provisional categorizations, and the Ministry of Finance plans to compile a report by January 2027.