What has happened?
The World Bank has announced that 70 years after its first bond transaction, it will be issuing the world's first bond to use entirely blockchain.
What does this mean?
In a press release, the World Bank has announced that it has mandated the Commonwealth Bank of Australia to arrange the world's first bond globally to be "created, allocated, transferred and managed" using blockchain technology.
The World Bank said that indicative interest in the blockchain-operated new debt instrument, nicknamed "bond-i", presumably named after Australia's famous Bondi beach, has been strong.
The statement did not indicate when the project will start or its size, but the transaction is expected to launch after a consultation with more investors.
"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," the statement read.
The World Bank was created in 1944 and operates as a global development co-operative owned by 189 nations.
It issues between $50 billion and $60 billion a year in bonds 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,” World Bank Chief Information Officer Denis Robitaille said.
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