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German industrial giant Siemens announced on Wednesday that it has issued a digital bond worth 300 million euros (330 million dollars) using Blockchain technology as part of a European Central Bank trial. Siemens’ initiative marks a significant step in exploring the use of Blockchain for traditional financial instruments to enhance transaction efficiency and transparency.
Record Speeds Achieved in Blockchain-Based Bond Issuance
The issuance attracted investment from major German financial institutions including BayernLB, DekaBank, DZ BANK, Helaba, and Landesbank Baden-Württemberg. Deutsche Bank‘s involvement in the issuance process indicates growing interest in Blockchain-based assets among traditional financial players.
This latest bond issuance is part of Siemens’ past experiences with Blockchain technology. Last year, Siemens issued a 60 million euro bond on the Polygon (MATIC) Blockchain, which took two days to complete. In contrast, the current bond issuance was completed within minutes, highlighting significant advancements in transaction speed and efficiency.
Siemens’ Corporate Treasurer Peter Rathgeb stated, “The automated transaction completed within minutes demonstrates the tremendous potential of this new technology and confirms our strategy to play a pioneering role in continuously shaping digital transformation.”
The bond was issued on SWIAT’s private, regulated Blockchain, leveraging Bundesbank’s settlement trigger solution. By using a private Blockchain for bond issuance, the aim is to benefit from faster settlement times, lower costs, and greater transparency while maintaining security and control.
Potential of Blockchain Technology Unveiled
Meanwhile, Siemens’ bond issuance on a private Blockchain is part of the ECB’s broader effort to test the potential of using Blockchain technology in its operational activities. The trial aims to assess the feasibility of integrating Blockchain technology with traditional financial systems and potentially pave the way for wider adoption of digital bonds and other tokenized real-world assets.
Last month, Germany’s largest development bank KfW collaborated with Boerse Stuttgart Digital in preparation for a digital bond issuance, while Italy’s state-owned development bank Cassa Depositi e Prestiti SpA and credit company Intesa Sanpaolo made headlines in July for completing a bond issuance on Polygon.
