The World Bank is preparing to conduct the world’s first bond transaction using ethereum blockchain platform. The initiative will show the possibilities of the blockchain technology and how it can be used to make bond trading more quick and efficient, according to Reuters.
According to the Commonwealth Bank of Australia (CBA), which was chosen to deliver the bond, the transaction is planned to be settled on Tuesday, August 28. The bond, called Bondi-i, is expected to raise from $50 to $100 million in Australian dollars and will be issued for a two-year period.
Executive general manager at CBA James Wall, earlier told Reuters that “You’re collapsing a traditional bond issuance from a manual bookbuild process and allocation process, an extended settlement then a registrar and a custodian, into something that could happen online instantaneously.”
The name Bond-i is the abbreviation for Blockchain Offered New Debt Instrument and is also a reference to the popular Bondi beach in Australia. The World Bank’s innovation lab in partnership with the Commonwealth Bank of Australia has been working on the project for almost a year.
Bond-i will be issued on a blockchain platform that runs on a private ethereum network, which will be operated by the CBA in Sydney and the World Bank in Washington. They also partnered with tech giant Microsoft, which will be responsible for handling the technological framework of the bond issuance in the public offering.
Other partners that took part in the initiative include Northern Trust, the Treasury Corporation of Victoria, QBE, and legal company King & Wood Mallesons, which advised on the legal framework for the project.
The money raised from the new blockchain bond will go on projects run by the World Bank’s Reconstruction and Development division. With an aim of facilitating progress in emerging countries, the bank annually issues $50–$60 billion of bonds.
The division is committed to reduce poverty and drive sustainable growth in low-income economies by delivering financial services like loans, risk management products, guarantees, and policy advice.
Earlier this year, Russian bank Sberbank and telecoms company MTS conducted the country’s first commercial bond transaction on the blockchain platform. Still, the deal, worth $11.20 million, was offered via private placement. As for World Bank’s bond, it’s the first time the funds are raised from public investors through a legal blockchain bond issuance.
A few weeks ago, CBA conducted an experiment showing that the blockchain technology can be used to transform the future of global trade. Thanks to a partnership with five domestic and international supply chain leaders, the bank successfully delivered 17 tons of almonds from Australia to Hamburg, Germany.
All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express written permission from LEADERSHIP Nigeria Newspapers. Contact: [email protected]
NEWS23 hours ago
26-year-old Nigerian, Adekunle Becomes World Highest Paid Robotics Engineer
NEWS10 hours ago
Again, Gemade Defects To Another Party
NEWS19 hours ago
Abe To Amaechi: God Will Decide Rivers’ Next Governor
NEWS24 hours ago
Blogger, Linda Ikeji Gives Birth To Baby Boy
POLITICS7 hours ago
Kwara 2019: Imposition Of Candidate Will Be Counter-productive – Saliu Mustapha
POLITICS18 hours ago
2019: Timi Frank Hails Dogara’s Move To PDP
FOOTBALL19 hours ago
World Legends, Ex-Eagles Stars Converge On Abuja To Kick Out Corruption
COVER STORIES12 hours ago
Court Stops Ex-parte Orders On All Political Cases