Central Bank of Australia (CBA) reported more than a satisfactory public response to their first ever blockchain-based bond – Bond-i, according to CNBC.
Our readers had a chance to read all about this $80.48 million World Bank’s project, which they entrusted to the CBA, as a representative of the country with one of the highest blockchain adoption rates in the world.
According to the World Bank’s announcement,
“The two-year bond raised $110 million AUD, marking the first time that investors have supported the World Bank’s development activities in a transaction that is fully managed using the blockchain technology.”
The bank has originally reported it would settle on $100 million AUD ($73 million U.S.).
Bond-i Was Well Received by the Investors
Besides raising more than expected, the initiative was welcomed. “I am delighted that this pioneer bond transaction using the distributed ledger technology, bond-i, was extremely well received by investors,” stated World Bank Treasurer, Arunma Oteh while explaining the enormous recognition that the bond got from the investors.
Furthermore, he emphasized the interest from official institutions, as these high-quality investors understood the value of leveraging technology for innovation in capital markets.
Paul Snaith: “Australia is Interested in Blockchain”
In a recent interview, the head of the World Bank’s treasury operations, Paul Snaith explained the reasons why Australia and CBA were chosen to spearhead the innovative process.
“There is a very positive environment nurturing blockchain FinTech,” Snaith declared. “We think all levels of the Australian government are interested in all these technologies, and we think the regulators there are interested in what’s going on.”
He also praised CBA for their dedication to innovation and understanding of new technologies.
“They understand this kind of technology is both a threat and opportunity in every line of business that they have. That’s why they have the innovation lab in Hong Kong, one in Sydney and one in London. We recognize them as innovative,” deduced the World Bank’s high official.
As for the reason they’ve picked Australia, Snaith stated that the World Bank has been issuing debt in Australia for a long time, and have been reactive to its market, so, whether at the regulatory level, the innovation level or the market level, they see Australia as a perfect development environment.
Crypto Token Was Considered But World Bank Went for the Familiar Funding Mechanism
Towards the end of the interview, Mr. Snaith revealed that they have been considering to use a cryptocurrency token for the settlement on this bond transaction but have decided to stick with more familiar means of operations, “primarily to de-risk the transaction a little bit to enable familiarity for all investors with regard to the cash side of the transactions.”
If the head of the World Bank’s treasury operations thinks that the only risk that cryptocurrency would bring to this project would be the investors’ distrust in those kinds of payments, that means that, with more adoption of crypto, World Bank would consider to use it in similar projects in the future.
If that would be the case, there are less than a few better ambassadors for new technologies than the “bank of banks” itself.
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