Euroclear announced the successful settlement of its inaugural digital note, a World Bank offering on the Luxembourg Stock Exchange, which amassed 100 million euros ($106 million) dedicated to sustainable development initiatives.
In connection with this, it’s worth noting that discussions about the evolving landscape of digital assets will be highlighted at Benzinga’s Future of Digital Assets conference on Nov. 14.
The Brussels-based securities clearing entity, among the globe’s most prominent, indicated that this event signifies the commencement of its digital securities settlement service, Reuters reported.
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This service empowers clients to initiate, disseminate, and finalize entirely digital international security through distributed ledger technology (DLT) – the foundational technology behind cryptocurrencies.
This development further underscores the increasing inclination of traditional market structures, like clearing houses, to embrace the digital domain, especially as regulatory bodies grow more receptive to such technologies.
Integrated with Euroclear’s principal settlement system, which processes trillions of euros in global securities, the digital platform strictly adheres to the European Union’s settlement system regulations.
“Today’s launch marks an important moment for our clients and for the potential of digital assets,” Euroclear CEO Lieve Mostrey said.
Citibank C acted as the issuing and payment agency while TD Securities served as the dealer and Euroclear Bank functioned as the central securities depository for the issuer.
This is not the World Bank’s initial foray into blockchain. It pioneered the issuance of the first public blockchain bond in August 2018 to explore the technology’s potential. Collaborating with a leading clearing house signifies an evolution in the budding market.
“The World Bank, as the issuer of the world’s first blockchain bond, is pleased to now be the first issuer to participate in this new service which offers full scalability and transparency,” World Bank CFO Anshula Kant said.
While numerous pilot projects focusing on blockchain-based securities issuance and settlement exist, a unified market connecting them remains elusive.
UK Finance, representing British banks, recently highlighted that despite the growth in digital bond issuance, it accounted for under 1% of the $20.6 trillion in long-term fixed-income instruments issued in 2021.
Additionally, the European Investment Bank launched its premier sterling-denominated digital bond in Luxembourg on private blockchains, while the Swiss Exchange has ventured into issuing a blockchain-based digital bond.
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