In the midst of all the speculations on how much the banking system would save by using the blockchain, The World Bank decided to speed up the implementation of the new technologies by assigning the creation of the first blockchain-based bond to Commonwealth Bank of Australia (CBA).
The bond is named Bond-i, which is an acronym for Blockchain Offered New Debt Instrument, also relating to the famous Bondi Beach in Sydney.
The world’s first blockchain-based bond will be developed with the help of the software giant – Microsoft.
Blockchain Simplifies Fundraisings, Securities Trading, and Enhances Regulatory Oversight
Bond-i will be the first in the world created, allocated, transferred and managed by the blockchain technology that the majority of the cryptocurrencies lean on, which transparently and securely processes and records all transactions across the network.
“Blockchain has the potential to streamline processes among numerous debt capital market intermediaries and agents. This can help simplify raising capital and trading securities; improve operational efficiencies, and enhance regulatory oversight,” reads the announcement on the World Bank’s official website.
Bond-i Will be Using Ethereum
Partnered institutions decided to use the Ethereum-based blockchain (presumably because of its smart contracts feature and deepest development pool), but decided to leave some room for the eventual system change as, according to them, the future might bring more efficient solutions.
Is the World Bank Fighting Poverty Through New Technologies?
“Helping countries transition to technology-led development is key to our goals of reducing poverty and promoting lasting development,” declared Denis Robitaille, World Bank Group Chief Information Officer.
“This is at the heart of the World Bank’s Innovation Lab – and this pioneering bond is a milestone in our efforts to learn how we can advise our client countries on the opportunities and risk that disruptive technologies offer as we strive to achieve the Sustainable Development Goals,” he explained.
Arunma Oteh, World Bank Treasurer, stated his belief that emerging technologies equally offer transformative, yet prudent possibilities for the bank to continue to innovate, respond to investor needs, and strengthen markets.
He also expressed his delight in working with the Commonwealth Bank of Australia, which put them in a position to launch the first blockchain bond transaction.
“CBA’s commitment and Microsoft’s wealth of experience have been instrumental to achieving this historic milestone,” said Oteh.
Microsoft Aligns With the World Bank’s Noble Work
The general manager of the Azure Blockchain Engineering at Microsoft, Matt Kerner, talking about the project, described the World Bank as a noble institution whose work Microsoft can align with, because of their mission to empower every person and organization on the planet.
The exact date when Bond-i will be live is yet unknown, but The World Bank has revealed that investors’ interest is high and that consultation with more investors will precede the launch.
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