This development essentially cements blockchain’s future in the coming years. Its adoption will slash costs, boost transparency and will revolutionize the finance industry from what we know it today.
In what is likely to be a milestone for blockchain technology, Commonwealth Bank of Australia has won a mandate from the World Bank to organize a bond issue create and run using only blockchain.
On Friday, the duo, CBA and the World Bank, stated, interest in “bond-i”, the new blockchain operated debt instrument, has been strong.
This will be the first time since the world bank will be using blockchain technology. No date and size of the issue has been provided by either of the two. More information will be available once the issue is launched following a period of consultation with more investors.
Using blockchain technology will significantly simplify raising capital, trading as well as improve oversight, said CBA, Australia’s biggest bank.
The World Bank typically issues bonds in the range of $50 billion to $60 billion a year to back development in emerging economies.
“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,” said Denis Robitaille, the World Bank’s chief information officer, in a statement.
CBA disclosed, it had found solutions to technical and legal issues surrounding the issue of bond-i.
Incidentally , CBA’s blockchain push come midst the Australian Securities Exchange planning to switch to blockchain based settlement system in equities from 2020 in order to boost transparency and cut costs.