Philippines to Launch First Tokenized Treasury Bond Sale
The Philippines is making history by introducing its first sale of tokenized treasury bonds on November 20. This move aims to advance the development of the domestic debt market, with a minimum of 10 billion pesos ($179 million) worth of one-year tokenized bonds to be presented.
The Bureau of the Treasury has canceled the regular bills auction scheduled for the same day to make way for this significant offering, as reported by Bloomberg on November 16.
Adoption of Blockchain and Tokenized Securities in Asia
Asia has seen a rise in the adoption of blockchain and tokenized securities for fundraising, with Hong Kong issuing HK$800 million in tokenized green bonds in February. These securities utilize distributed ledger technology (DLT) to enhance liquidity and transparency within debt markets.
HSBC Holdings recently conducted successful test token deposits in intra-group treasury transactions using blockchain technology, further demonstrating the growing adoption of this innovative approach.
Details of Philippines Bond Offering
The Bureau of the Treasury’s notice of offering reveals that the tokenized bond, maturing in November 2024, will be offered to institutional buyers in minimum denominations of 10 million pesos, with increments of 1 million pesos. The final interest rate will be determined through book-building and announced on November 20. The state-owned Development Bank of the Philippines and Land Bank of the Philippines are acting as issue managers for this initiative.
Other Ventures into the Digital Domain by World Banks
European banks are increasingly accepting cryptocurrency, with Commerzbank AG being granted a cryptocurrency custody license on November 15. Several banks, including Commerzbank, are exploring cryptocurrency due to growing client interest. Societe Generale SA’s blockchain unit secured the first license under France’s new cryptocurrency regulations, and DZ Bank AG plans to launch a platform dedicated to secure custody of digital assets.
Hot Take: Advancements in Tokenized Bonds and Cryptocurrency Adoption
The introduction of tokenized treasury bonds by the Philippines signals a significant step towards advancing debt market development through blockchain technology. This move reflects a broader trend seen in global banking institutions, with increasing acceptance and exploration of cryptocurrency-related services and offerings among traditional banks.
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