Singapore Exchange Issues First Blockchain Based Digital Bond

Singapore Exchange (SGX), in collaboration with HSBC Singapore and Temasek, has successfully issued the first blockchain-based digital bond.

04 September, 2020 | AtoZ Markets – The Singapore Exchange is an investment holding company. The company operates as a securities and derivatives exchange in Singapore. SGX is also a member of the World Federation of Exchanges and the Asian and Oceanian Stock Exchanges Federation.

SGX Successfully Launch First Digital Bond Issuance 

Singapore Exchange (SGX) has successfully completed its first blockchain-based digital bond issuance in partnership with Temasek and HSBC. This is Asia's first syndicated public, corporate bond. SGX said it has succeeded in issuing S$400 million of 5.5-year bonds. Moreover, Olam International has reserved an additional S$100 million (US$74 million) of digital bonds for later issuance. Lee Beng Hong, Senior Managing Director, Head of Fixed Income, Currencies and Commodities (FICC), SGX, also said:

"We are very excited that this collaboration with HSBC and Temasek has led to the successful completion of the first digital syndicated public, corporate bond in Asia. Debt capital markets globally are characterized by deeply engrained legacy systems and also processes that can be made faster, more accurate, and efficient with this new technology. 

HSBC provided an on-chain payment solution that enables instant payments in multiple currencies for processing funds between issuers, arrangers, and investor custodians. David Koh, Head of Global Liquidity and Cash Management, HSBC Singapore, said,
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"We're proud to be working closely with SGX and Temasek. It drive faster, more transparent, and fully secure settlements for bond issuers and investors. This first digital bond issuance for Olam International also shows how our on-chain solution can fulfill payment needs in DLT-based ecosystems and demonstrates our desire to shape and participate in the next generation of asset networks, to better service our securities services clients. 

According to SGX, it uses smart contracts and distributed ledger technology (DLT) to model the bond. Moreover, it helps to understand the rights and obligations of parties involved in issuance and asset management. SGX also said DLT could streamline issuance in Asian bond markets and minimize settlement risk.

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