Major investment holding firm Singapore Exchange (SGX) has issued a digital bond, harnessed by blockchain technology for the first time.
Announced earlier this month, SGX launched its asset platform to issue digital bonds, conducting a 400 million Singapore dollar (which translates to around $294 USD million) public bond for Olam International, a food and agricultural business company in the region.
New tech for the Asian bond market
The digital platform is focusing on the Asian bond market and is in collaboration with the firm’s blockchain partners already in place. SGX has teamed up with current partners HSBC Singapore and investment firm Temasek to launch the project, leveraging technology and developments from the individual companies. For example, HSBC has offered a blockchain payment solution which will help the firm service instant payments in different currencies across the globe. This will help streamline the bond between the issuer, arranger and investor.
This move marks an exciting milestone in the digital asset market as it shows how blockchain can be further leveraged in global economics. According to the announcement:
“An Asia first for a syndicated public corporate bond, this digital bond marks another milestone in SGX’s use of digital asset technology, by streamlining processes for issuers, underwriters, investors and ecosystem participants across primary issuance and asset servicing.”
Innovative improvements to investment
HSBC Singapore’s David Koh, commented on the news that this is exciting to bring improved methods of secure settlements to bond issuers and investors, saying:
“We’re proud to be working closely with SGX and Temasek to drive faster, more transparent, and fully secure settlements for bond issuers and investors. This first digital bond issuance for Olam International shows how our on-chain solution can fulfil 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. We look forward to bringing this technology to our clients in Singapore and beyond.”