EIB settles €100 million digital bond on private blockchain
According to a new press release on Nov. 29, the European Investment Bank, or EIB, issued a first-ever euro-denominated €100 million digital bond on a private blockchain-underpinned platform with tokenization help from Goldman Sachs.
The latter, along with Société Générale Luxembourg, also act as the on-chain custodians for the financial instrument. The bond bears interest at a coupon rate of 2.57% per year with a maturity date of Nov. 29, 2024, and is governed by Luxembourger laws.
Banque de France and the Banque Centrale du Luxembourg participated in the project to provide a digital representation of euro central bank money. The EIB says that "the transaction paves the way for future on-chain derivative solutions, by using the first interest rate swap hedge represented through the industry-developed common domain model."
In addition, the bond represents the "first cross-chain Delivery vs. Payment (DVP) settlement using an experimental CBDC [Central Bank Digital Currency] token."
Last April, the EIB successfully issued the first digital euro bond on a public blockchain. Goldman Sachs, Banco Santander, and Société Générale led the sale of the two-year €100 million digital bond. Regarding today's novel digital bond issuance on a private blockchain, Ricardo Mourinho Félix, EIB's Vice President, commented:
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