World Bank and Australia’s CommBank Perform The First-Ever Blockchain Bond Bank Transaction

The World Bank and the Commonwealth Bank of Australia (CommBank) have decided to team up in order to perform the first blockchain bond transaction. The information was released by the firms in a press release on May 15.

World Bank and CommBank Enable Bond Trading on Blockchain

As per the press release, the institutions were able to record a secondary transaction for bond-i, a blockchain-operated debt instrument that will be based on distributed ledger technology (DLT). This shows the potential that the technology has and how it can improve many aspects of the financial industry.

The bond was issued by the World bank and the CommBank was a sole arranger. At that time, the bank was able to raise $81 million. On the matter, the World Bank Vice President and Treasurer, Jingdong Hua, commented:

“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.”

This blockchain platform was build by the CommBank and its Blockchain Centre of Excellence. In order to create these services, developers worked on top of the Ethereum (ETH) blockchain and it was reviewed by Microsoft.

Sophie Gilder, the head of experimentation & commercialization of the CommBank Innovation Labs, explained that DLT has the potential to streamline processes that are related to raising capital and trading securities.

At the same time, the bond-i project continues to expand and improve by facing the current challenges they face. In addition to it, foundation investors and other capital market partners provide feedback on the products released by the World Bank. In the future, there are going to be more partners and interest from other individuals.

The Chief Technology Officer (CTO) of the Bank of America, Catherine Bessant, said that they were not able to find any use case for blockchain tech in the financial industry. This is a clear contrast from what the World Bank and the CommBank are currently doing.

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