The World Bank raised funds through the debt instrument bond-i, which was the first of its kind in the world to be structured, assigned, transferred and administered using distributed ledger technology via its lifespan. CBA (Commonwealth Bank) was the bond’s sole arranger.
Currently, a three-way collaboration, which also encompasses market maker TD Securities, has presented what the respondents believe a first comparable and a second rebirth for blockchain bonds.
World Bank’s vice president and treasurer, Jingdong Hua
“Enabling secondary trading recorded on the blockchain is a tremendous step forward towards enabling capital markets to leverage distributed ledger technologies for faster, more efficient, and more secure transactions.”
Hua further said:
“It speaks to the innovation and commitment of all our partners, including investors, that we were able to achieve this together.”
The accomplishment comes only weeks after the issue of a € 100 million ($ 112 million) bond on Ethereum by French banking group Societe Generale, while the concept of blockchain credits proceeds to stretch beyond the finance industry. Successful closure of a supplementary transaction with trading activity documented on a distributed ledger shows the huge opportunity for improving securities trading and administration on blockchain–offering a proven, continuous record and immediate reconciliation.
CBA created the features in combination with World Bank and TD Securities market maker. During one of its hosting activities in April, the authorities of three emerging countries themselves informed the World Bank that they even wanted to introduce a Bitcoin (BTC) bond.
Sophie Gilder, Commonwealth Bank’s head of experimentation & commercialization, said “Blockchain has the potential to streamline processes for raising capital and trading securities, improve operational efficiencies, and enhance regulatory oversight.”
The ‘bond-i’ undertaking is component of the World Bank’s broader strategy on harnessing the ability for growth of disruptive techniques. The CBA Blockchain Center of Excellence, located in the Sydney Innovation Lab, established the bond-i blockchain platform.