$1.35 Billion Bond To Be Issued Using The Ethereum Blockchain Network
The live blockchain notarization that is to hold on October 2 will be operated by the Oesterreichische Kontrollbank (OeKB). The bank is one of the largest banks in Austria with $26 billion worth of assets in 2017. The bank will issue the bond on behalf of the Austrian Treasury (OeBFA).
According to Austria’s Finance Minister, Hartwig Löger, the ministry of finance of Austria considers the blockchain tech as an outlook of economic policy. Hartwig further stated that through setting up of the advisory council at the Ministry of Finance, the ministry is developing strategies that will enable Austria to benefit from blockchain tech.
Further, spokesperson for OeKB noted that this would be the first time that a blockchain based notarization service will be a feature of the Federal Bond Auction in Austria.
Notably, the procedure that the blockchain bond issuance will take has already been tested, and it was internally developed by OeKB to notarize data from the Austrian Direct Auction System (ADAS) as a hash value on the Ethereum public blockchain.
Markus Stix, Managing Director at the Austrian Treasury, noted that the use of the blockchain technology has critical benefits for cost reduction and security. He further stated that the added protection contributes to achieving a high level of confidence in the auction process for Austrian government bonds and strengthens Austria’s good standing in the market. This is noted to have the capacity to contribute to favorable financing cost indirectly.
The Blockchain Technology Adoption
The blockchain technology has seen its application in almost every facet of the human society. The benefits of technology have gone far beyond the financial world.
Notably, the prospect of cryptocurrency to replace fiat currency has made an IMF chief to call upon the apex bank of countries and financial institutions to adopt the technology.
There has been an adoption of the blockchain tech by financial institutions and even the World Bank to issue a public bond in conjunction with the Commonwealth Bank of Australia (CBA).
Also, Sberbank CIB, the corporate and investment banking arm of Russia’s largest bank, conducted a blockchain based commercial bond transaction recently.