Euroclear Leverages Blockchain for Digital Securities Issuance, Settles $106M World Bank Bond
Summary:
Euroclear, a Brussels-based settlement house, launched a digital securities issuance service by settling a 100-million-euro digital World Bank bond, marking the beginnings of its digitization strategy. The bond was issued by the World Bank's lending division to foster sustainable development and was listed on the Luxembourg Stock Exchange. Euroclear's digital infrastructure, which uses R3’s Corda blockchain technology, is connected to its conventional platform, in compliance with the European Union’s regulations. Notably, this move places Euroclear among a growing list of securities settlement houses exploring digitalization.
Euroclear, a Brussels-based settlement house, has initiated a digital securities issuance service, successfully settling a digital World Bank bond equating to 100 million euros ($106 million). This marks the beginning of Euroclear's digital strategy revamping. The bond, referred to as a digitally native note, is a three-year offer, coming from the World Bank's lending division, the International Bank for Reconstruction and Development, and is aimed at generating sustainable development funds. This bond gets listed on the Luxembourg Stock Exchange and the transaction was finalized on October 23.
The digital infrastructure of Euroclear is interlinked with its traditional platform tasked with secondary operations and it adheres to the Central Securities Depositories Regulation issued by the European Union. It relies on R3’s Corda blockchain technology. Anshula Kant, the managing director and CFO of World Bank Group noted, “The capital markets are progressively transitioning towards digitization. Euroclear’s recent service enables both issuers and investors to venture further down this digitization path.” The completed issuance was settled under the jurisdiction of English law. Service providers, Citi Issuer Services, acted as the issues and payment agent while TD Securities fulfilled the role of issuer agent.
With this initiative, Euroclear joins numerous other prominent securities settlement houses that are exploring digital frontiers. In 2018, the first digital bond was issued by The World Bank. Currently, digital bonds have been put forth in Hong Kong dollar denominations and also in Chinese yuan within this year. The Luxembourg Stock Exchange saw the registration of its premier digital bond, denominated in Swedish krona, in June. In the same month, the Tel Aviv Stock Exchange conducted a proof-of-concept for tokenizing bonds. DTCC, yet another significant settlement house, confirmed the purchase of digital infrastructure developer Securrency, on October 19th with ambitions to establish itself as a pioneer in unlocking the digital assets' potential.
Published At
10/24/2023 5:22:01 PM
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