The World Bank Is Still Loving Its Blockchain-Powered Bonds
Wednesday, August 21, 2019
The World Bank’s blockchain-based bond wasn’t just a one-hit wonder. Nearly a year after it issued the two-year bond, the government-run global development bank has issued a second round, bringing the total raised to $108 million.
The news: Bonds are like loans that governments, and large financial institutions, use to raise funds. Holders of bonds receive interest from them until they mature after a fixed period of time, when the issuer repays their debt. The World Bank issues between $50 billion and $60 billion in bonds each year to help fund sustainable development projects in emerging economies. Now, it has joined up with Commonwealth Bank of Australia (CBA), RBC Capital Markets, and TD Securities to manage the bond, which will be “created, allocated, transferred, and managed through its life-cycle” on a blockchain, according to a press release.
Photo courtesy of Christian Ditaputratama.