October 25, 2023

World Bank, Euroclear Issue €100 Million-Digital Bond via Blockchain

The World Bank

The World Bank

Euroclear, a major European clearinghouse, has partnered with the World Bank to launch a new tokenized securities issuance service.

This service aims to integrate DeFi technology into traditional finance (TradFi) services to improve efficiency, transparency, and accessibility. This initiative was marked by issuing a €100 million ($106 million) digital bond, as announced in a press release on Tuesday.

Euroclear’s Digital Securities Issuance (D-SI) unit is leading the way in facilitating the issuance, distribution, and settlement of fully digital financial assets through distributed ledgers. Distributed ledgers are unique in their structure as they enable each participant or node in a network to hold and update a database independently.

The International Bank for Reconstruction and Development (IBRD) of the World Bank Group is using a bond to direct funds towards sustainable development projects.

The bond was successfully listed on the Luxembourg Stock Exchange, demonstrating its potential in mainstream financial markets. Citibank is the issuer agent and investment manager, while TD Securities is the dealer. The issuance was carried out using R3’s Corda blockchain platform, indicating the growing confidence in blockchain technology.

Euroclear’s CEO, Lieve Mostrey, highlighted the importance of the launch of their latest initiative. She emphasized that the launch is a significant moment for their clients and marks the potential of digital assets.

Euroclear is committed to providing technology solutions that empower investors, promote market transparency, and support the growth and stability of all market participants.

This initiative clearly indicates the convergence between traditional financial services and digital assets. By tokenizing real-world assets (RWA) on blockchain-based infrastructures, there is an opportunity for increased efficiency, reduced operational costs, and improved accessibility and transparency.

The tokenized asset market is rapidly growing, and according to predictions by digital asset investment firm 21.co, it is expected to be worth between $3.5 trillion to $10 trillion by the end of the decade.

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