Development – Disruptive Technologies
World Bank Prices First Global Blockchain Bond, Raising A$110 Million
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WASHINGTON/SYDNEY, August 23/24, 2018 – The World Bank launched bond-i (blockchain operated new debt instrument), the world’s first bond to be created, allocated, transferred and managed through its life cycle using distributed ledger technology. The two-year bond raised A$110 million, marking the first time that investors have supported the World Bank’s development activities in a transaction that is fully managed using the blockchain technology.
The World Bank mandated Commonwealth Bank of Australia (CBA) as arranger for the bond on August 10. The announcement was followed by a two-week consultation period with the market, with key investors indicating strong support for the issuance.
Investors in the bond include CBA, First State Super, NSW Treasury Corporation, Northern Trust, QBE, SAFA, and Treasury Corporation of Victoria. CBA and the World Bank will continue to welcome investor interest in the bond throughout its life cycle, and inquiries from other market participants in relation to the platform.
The bond is part of a broader strategic focus of the World Bank to harness the potential of disruptive technologies for development. In June 2017, the World Bank launched a Blockchain Innovation Lab to understand the impact of blockchain and other disruptive technologies in areas such as land administration, supply chain management, health, education, cross-border payments, and carbon market trading.
Arunma Oteh, World Bank Treasurer, said: “I am delighted that this pioneer bond transaction using the distributed ledger technology, bond-i, was extremely well received by investors. We are particularly impressed with the breath of interest from official institutions, fund managers, and banks. We were no doubt successful in moving from concept to reality because these high-quality investors understood the value of leveraging technology for innovation in capital markets…