One of the largest Asian banks has launched its blockchain bonds with a six-month term.
June 2, 2021, | AtoZ Markets -DBS Bank, one of Singapore’s largest banks announced the new “DBS Digital Bond” based on blockchain and have a coupon rate of 0.60% per year.
In the official statement DBS wrote:
“As part of efforts to broaden the suite of products on the DBS Digital Exchange (DDEx), DBS announced today that it has priced an SGD 15 million digital bond, marking DDEx’s first Security Token Offering (STO)”.
Also, the company said “The DBS Digital Bond, which comes with a six-month tenor and coupon rate of 0.60% per annum, was done by way of private placement. DBS is the sole bookrunner for the transaction”.
It is no secret that in Asia there is currently a strong demand for cryptocurrencies, so most financial institutions have decided to bet on this type of proposals and create their platforms for the exchange of digital currencies.
The Asia-Pacific region currently accounts for nearly one-third of the global private equity market, which reached a record USD 4.73 trillion in 2020.
It is because of this great growth that Eng-Kwok Seat Moey, Group Head of Capital Markets at DBS, noted that asset digitalization via the issuance of Security Tokens it represents a tremendous opportunity for corporates seeking alternative platforms.
The DBS Digital Bond strictly adheres to the current bond legal framework, thereby according investors the same legal certainties and protections over their rights as traditional bonds.
Clifford Lee, Global Head of Fixed Income at DBS said this marks the first of many steps in the journey to evolve the traditional bond issuance into a broader digital ecosystem where more inclusive issuer and investor participation can be rapidly developed.
What the Bank Says About Its DBS Digital Exchange
Launched in December 2020, DDEx is part of an integrated digital asset ecosystem which leverages on blockchain technology to provide clients with a secure and transparent platform to raise funds from the private market.
DDEx has enjoyed strong market traction since its launch. Daily trading volumes have increased 10-fold from the initial week of launch, and the exchange currently serves over 120 participants.
DBS also holds over SGD 80 million in digital assets in its custodial services.
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