Euroclear and World Bank Make History with 100M Euros Digital Bond on Corda Blockchain – Is Ethereum the Backbone?

Euroclear has unveiled its tokenized securities issuance service with the World Bank’s 100 million euro digital bond.
The bond was issued on the Corda blockchain, a permissoned blockchain platform used by businesses in the finance sector.

European clearinghouse Euroclear on Tuesday unveiled its tokenized securities issuance service. The financial services company has issued the World Bank’s 100 million euros ($106 million) digital bond according to a press release. Citi and investment manager TD Securities assisted in the issuance. Citi was the issuer agent and investment manager, while TD Securities acted as the dealer.

Through Euroclear’s Digital Securities Issuance (D-SI) business, the firm will issue, distribute, and settle fully digital financial assets on distributed ledgers. Euroclear is operating on the Corda blockchain according to the platform developer, R3. Corda blockchain, unlike a majority of mainstream blockchains which are permissionless and can be accessed by anyone, is a permissoned blockchain platform primarily used by businesses in the finance sector.

The World Bank intends to use this bond through the International Bank for Reconstruction and Development (IBRD) to finance sustainable development activities and is listed on the Luxembourg Stock Exchange.

Lieve Mostrey, Chief Executive Officer, Euroclear group stated that this was the next step in its aim to to deliver technology solutions that empower investors. She further highlighted the transparency offered by DLT as a key component to realizing its goal of being a fully digital and data-enabled financial market infrastructure.

Anshula Kant, Managing Director and Chief Financial Officer at World Bank Group on the other hand, hailed the bond for its ability to offer unparalleled scalability and transparency.

A transition to digitisation is underway in the capital markets. Euroclear’s new service offers issuers and investors an opportunity to take another step along this journey. The World Bank, as the issuer of the world’s first blockchain bond, is pleased to now be the first issuer to participate in this new service which offers full scalability and transparency.

This issuance is a demonstration of the intersection of traditional financial services, digital assets, and blockchain technology. This is regarded as tokenization and is a market in which Ripple and Stellar Lumens have taken the lead. It is estimated that this market will grow to between $3.5 trillion and $10 trillion in the next ten years.

Ethereum, the second largest cryptocurrency by market cap, and regarded as the blockchain ‘to build stuff’, is also looking to take a share of the tokenization market. Ethereum has already demonstrated its ability to command this market with €350M worth of real estate tokenized on Ethereum. Nike has also explored the idea of a sneaker tokenization system based on Ethereum.

Read More: Nike receives patent for Ethereum-based sneaker tokenization system

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