March 28, 2024

Bank of China issues $ 2.8 billion blockchain bonds

One of China's four largest commercial banks, Bank of China issued $ 2.8 billion blockchain bonds for small businesses.

The bank said it had completed pricing andissue of two-year bonds, which will go on sale with a coupon interest rate of 3.25% per annum. The statement notes that the bank is committed to raising funds to support these businesses.

"We used our own exhaust systemblockchain-based bonds", — the bank said in a statement. “It is also the first blockchain-based bond issuance accounting system in the country.”

The bank used its own system on the blockchain to issue digital certificates that confirm ownership, form groups of underwriters and document transactions.

Issue of bonds — part of the country's efforts tosupporting entrepreneurs for more efficient access to capital. As of September, the bank had provided $57.7 billion to more than 410,000 small and micro businesses, according to the organization.

Bond issuance on the blockchain is becoming more commontested by financial institutions. In November, custodian bank Northern Trust and Singapore-based BondEvalue conducted a joint blockchain test for tokenization and bond trading.

In November, HSBC and the Singapore Exchange said thatare exploring blockchain opportunities for the bond market, and in October a Deutsche Bank bond was tokenized on the EOS blockchain. In the fall, Santander Bank issued $20 million in bonds on the Ethereum blockchain, and in August, the World Bank sold a second batch of bonds on the blockchain in the amount of $33.8 million.

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