The European Investment Bank plans to leverage the power of blockchain to sell bonds, potentially helping to expand the use of the technology in the EU debt market.
The EU government financial institution has hired Goldman Sachs Group Inc., Banco Santander SA and Societe Generale AG to study the possibility of issuing a digital euro bond that will be registered and settled using the blockchain. Bloomberg refers to a source familiar with the issue, who wished to remain anonymous, as it is not authorized to disclose this information.
According to the source, meetings with investors for the first sale will begin on April 15 and will last for several weeks. The new initiative follows a statement from European Central Bank President Christine Lagarde that the institution she leads could release a digital currency around the middle of this decade. A spokesman for the European Investment Bank declined to comment on the initiative.
A number of issuers around the world, including the World Bank and China Construction Bank, have experimented with blockchain bond issuance in the past few years. However, the use of technology in debt markets is still far from widespread adoption.
Blockchain has a long history in lending and the German debt market. Carmaker Daimler AG was the first to sell € 100 million in debt using blockchain in 2017. The German arm of Telefonica SA also used the blockchain in early January to obtain a € 200 million loan.
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