May 28, 2023

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 completed pricing andissue of two-year bonds that will be on sale with an interest rate on the coupon of 3.25% per annum. The statement notes that the bank seeks to raise funds to support these enterprises.

“We used our own blockchain-based bond issuance system,” the bank said. “This is also the first blockchain-based system for accounting for bond issues 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.

Bonding is part of the country's efforts tosupporting entrepreneurs for more effective access to capital. According to the organization, as of September, the bank had provided $ 57.7 billion to more than 410,000 small and micro enterprises.

Blockchain Bonds Increasinglytested by financial institutions. In November, Northern Trust Depository Bank and Singaporean company BondEvalue conducted joint testing of the blockchain for tokenization and bond trading.

In November, HSBC and the Singapore Exchange announced thatare exploring blockchain opportunities for the bond market, and in October, Deutsche Bank bond was tokenized on the EOS blockchain. In the fall, Santander Bank issued bonds for $ 20 million 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.