Why Blockchain Should Be Japan-Sovereign and Public-Permissioned?

If blockchain is to be considered national infrastructure, its design cannot be decided only by whether it uses the latest technology. Especially in Japan, it is important that the system aligns with legal frameworks, regulations, and the way trust has traditionally been built in society.

Looking globally, the blockchain industry is already maturing. Innovative services with real scale are being deployed in areas such as payments, decentralized finance (DeFi), real-world assets (RWA), and voting systems. However, one reason why web3 services have struggled to gain widespread adoption in Japan is that blockchain infrastructure optimized for Japan’s regulatory environment - including financial regulations, domestic data requirements, and consumer protection - has not been sufficiently developed.

For example, in Japan’s financial and administrative systems, it has always been important to clarify who operates a system and who is responsible when problems occur. Identity verification is required when opening bank accounts or completing administrative procedures, and strict rules govern the handling of personal data. These measures exist to protect trust across society. A digital infrastructure that ignores these assumptions, even if technologically advanced, is unlikely to be accepted as critical national infrastructure.

This is where the concept of Japan's sovereignty becomes important. Infrastructure should operate under Japan’s legal and regulatory framework, with data and validation systems located domestically, and without dependence on foreign regulatory decisions or policy changes. This is a necessary condition for businesses and users in Japan to rely on the system with confidence over the long term.

At the same time, the idea of a public-permissioned model is essential. Just like infrastructure such as roads or power grids, which are open for public use, but built and operated under strict standards, blockchain can be publicly accessible and verifiable while requiring responsibility and standards for the entities that support the network. It is neither a system where anyone can participate without limits, nor one controlled exclusively by a single organization. This middle-ground design is what makes public-permissioned blockchain realistic as national infrastructure.

With such infrastructure in place, governments and major enterprises in Japan can invest in blockchain-based payment, loyalty and management systems confidence over the long term. Ultimately, the primary benefit of a public blockchain is that it reduces data administration and payment costs for consumers, small to medium enterprises, and large corporations alike. Additionally, improved transaction processing speeds and instant access to global markets will drastically reduce time wasted on bureaucratic procedures and transaction processing times that currently plague residents seeking to build productive, profitable businesses. Currently, small businesses in Japan - such as sushi restaurants or clothes stores - can expect to pay around 3% of their revenue in transaction processing costs alone. We anticipate that a full end-to-end payments processing system running on a public blockchain will reduce these same processing fees well below 1%, and not only provide faster settlement times, but better short-term cash management strategies to grow wealth.   

What matters for blockchain as national infrastructure is whether it can maintain sovereignty, align with laws and regulations, and provide verifiability; while continuing to support trust in society over time. This design philosophy will ultimately define the true value of blockchain in Japan.