World’s First Zero-Fiat ‘Bitcoin Bond’ Now Available On Bloomberg Terminal (#GotBitcoin?)
Two European companies have launched what they describe as the world’s first genuine bitcoin (BTC) bond, they confirmed in a joint press release on July 3. World’s First Zero-Fiat ‘Bitcoin Bond’ Now Available On Bloomberg Terminal (#GotBitcoin?)
Luxembourg-based Argento, a securitization firm, joined forces with London Block Exchange (LBX) to issue the bitcoin-denominated bond, which is regulated under the United Kingdom’s regulator, the Financial Conduct Authority (FCA).
“We are thrilled to have structured and produced the world’s first institutional grade bitcoin-denominated financial product,” Argento manager Phil Millo commented.
“The large investment banks really dropped the ball on this one.”
The Argento-LBX bond represents a first in regulated cryptocurrency products, in that it contains no fiat exposure for investors. It is readily available via Bloomberg Terminal, and is the first crypto product to have its own ISIN code.
Various durations are available, Argento conspicuously naming them after crypto-specific phenomena such as ‘FOMO,’ ‘HODL’ and ‘MOON.’
HODLers, LBX says, form one of the bond’s major target markets.
“This is an excellent product for people who currently hold bitcoin and aren’t planning to sell over the next few years…,” CEO Benjamin Davies added.
“Now, for the first time, they have an institutional grade way of making their wallets grow without exposing their bitcoin to the swings of the traditional ‘fiat’ currency markets.”
Previously, the governments of several developing nations had told the International Monetary Fund (IMF) that they were keen on issuing bonds tied to bitcoin.
Bank of China Issues $2.8B In Bonds For Small Businesses Using Blockchain Tech
Bank of China, one of the four major commercial banks in China, has issued 20 billion yuan ($2.8 billion) in blockchain-based bonds for small and micro-sized enterprises with their own blockchain platforms.
The bank announced Friday that it completed pricing and issuance of the bonds for the first period this week and the two-year bond will come to the market with 3.25% coupon rate, according to a statement. The bank aims to raise funds to support these businesses.
“We have used our own blockchain-based bond issuance system in the process,” the bank said in the statement. “This is also the first bond issuance ledger system that is based on blockchain in the country.”
The bank used its own blockchain system to issue digital certificates that prove ownership, form groups of underwriters and document proof of transactions.
The bond issuance is part of the country’s effort to support entrepreneurs with more efficient access to capital. As of September, the bank has lent 404 billion yuan ($57.7 billion) to more than 410,000 small and micro sized enterprises, the bank said.
Financing for small and medium sized enterprises (SMEs) has been one of the major blockchain use cases for banks and financial services companies in China.
Industrial and Commerce Bank of China (ICBC), the largest bank by assets in the world, started to offer factoring services (transactions where a business sells account receivables to a third party at a discount in return for immediate cash payment) to SMEs on their blockchain platform in February 2018.
Ant Financial, the fintech arm of tech giant Alibaba, announced it would launch its own blockchain platform to provide SMEs with more reliable financial services in three month.
Beyond China, Spanish banking giant Santander has issued $20 million bonds which trade on ethereum in September in a bid to accelerate the bond issuance process.
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