Austria To Use Ethereum To Issue $1.35 Billion USD In Government Bonds
The government of Austria has decided to use Ethereum (ETH) to issue about $1.15 billion EUR ($1.35 billion USD) of government bonds during an auction that will be made next week. Oesterreichische Kontrollbank (OeKB), which is currently one of the biggest banks in the country with a total of $26 billion USD in assets, will be the one to operate the blockchain notarization service.
At the moment, the auction is scheduled for October 2 and the bank is going to issue the bonds on behalf of the Austrian Treasury. The minister of finances in the country, Hartwig Loger, has affirmed that the ministry is considering using the blockchain as a form to focus on economic policies.
He has also stated that via the Advisory Council and the Ministry of Finance, the team is developing strategies to enable Austria to benefit from the developments of the technology. As blockchain-bases notarization will be used for the first time in the country, the procedure has to be tested extensively in order to establish the system.
The system will use the Austrian Direct Auction System (ADAS), which will notarize the data from the already established system as hash values on the Ethereum public chain. This, the ministry believes, can add security to the process and achieve a higher level of confidence in the auction process for bonds, which can strengthen the good standing of the country in the market.
A new system would work in parallel with the existing paper and digital system, as the tokenized bonds would have their own system.
Other similar activities include a major joint initiative between the World Bank and the Commonwealth Bank of Australia to issue public bonds exclusively via the blockchain technology and an initiative from Sberbank, a large Russian bank, to conduct blockchain-based bond transactions.