Japan’s Ministry of Finance has proposed three distinct models for government bond tokenization during the inaugural meeting of its Government Bond On-Chain Research Group. The classifications include circulating beneficial interests of money market funds investing in bonds, placing transfer ledgers on-chain under existing settlement systems, and issuing new bond forms on external blockchains outside current frameworks. The ministry stated that on-chain integration could enhance collateral and liquidity management efficiency while expanding access for overseas investors. However, officials also identified significant challenges, including potential market fragmentation, transmission of sharp price fluctuations, and system renovation costs. These provisional classifications will be refined as the ministry works toward compiling a comprehensive report by January 2027.