World Bank Blockchain Bond Easily Raises A $110 Million in Industry First

First announced earlier this month, the World Bank has revealed their first “blockchain bond” or bond-i easily raised A$110 million.

Arunma Oteh, World Bank Treasurer, said he was delighted that the “pioneer bond transaction” was well received by investors. The bone was issued using a blockchain platform developed by CBA Blockchain Centre of Excellence (CBA – Commonwealth Bank of Australia).

“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,” said Oteh. “Our painstaking work, over the last year, and in partnership with Commonwealth Bank of Australia, was equally instrumental to the success of the transaction. Commendation also to our other service providers, King & Wood Mallesons, IHS Markit, Microsoft and Toronto Dominion Securities.”

After the issuance was announced, the World Bank commenced a two week consultation that indicated strong acceptance of the security on distributed ledger technology. The bond is said to be part of a larger strategic focus on the World Bank to harness disruptive technologies. In June of 2017, the World Bank launched a Blockchain Innovation Lab to better understand the potential impact of the tech.

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 expects to continue to welcome investor interest in the bond throughout its life cycle.

James Wall, Executive General Manager of IB&M International, CBA said the interest in the blockchain bond was “overwhelming.”

“It is clear the market is ready and open to the uptake of emerging technologies and sees the potential evolution of the capital markets. It has been a pleasure to work on such a ground-breaking transaction with a forward-thinking organization like the World Bank,” Wall added.

Derek Yung, Chief Operating Officer – Group Investments, QBE Insurance Group Limited, welcomed the opportunity to invest in the “world’s first global blockchain bond issue.”

“QBE seeks to collaborate with innovative partners, and CBA together with the World Bank, are leading the way for bond issuance with this ground breaking blockchain platform. We believe there is untapped potential for the application of this product to capital markets and are pleased to be involved as an early investor.”

The World Bank says it issues annually between US $50-US $60 billion in bonds for sustainable development.

“We welcome the huge interest that this transaction has generated from various stakeholders and will continue to seek ways to leverage emerging technologies to make capital markets more secure and efficient,” added Oteh

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