CBA Announces Plan to Issue Blockchain Bond by Early 2018

FILE PHOTO: The logo of the Commonwealth Bank of Australia (CBA) is displayed outside a branch in Sydney, Australia, March 21, 2016. REUTERS/David Gray/File Photo

The Commonwealth Bank of Australia (CBA) is hoping to issue a bond on a blockchain platform by the early part of next year.

Speaking at the Global Internet Conference in Sydney on the 5th of December, the institution’s head of blockchain Sophie Gilder said that the CBA will deliver the bond with help from a “very large” world issuer.

Gilder said:

“We’re particularly interested in [blockchain solutions] in financial markets in equities, bonds, syndicated loans, many other applications where we currently have markets that have a lot of friction – they currently don’t work well.”

However, along with these optimistic remarks, she also said gave caution, saying that “blockchain itself is not a complete solution.”

“As soon as I try to move money offshore, it becomes phenomenally inefficient as we’re using cutting-edge 1973 technology to move money around the globe. It’s really not fit for purpose in today’s global economy,” Gilder said, explaining that the process of transferring funds internationally is old-fashioned and that blockchain technology might be able to help.

Back in January this year, the Queensland Treasure Corporation was reported as testing a blockchain platform developed by the CBA intended to issue “semi-government” bonds.

Additionally, a press release by Russian mobile phone and telecom operator MegaFon on the 2nd of October claimed that the firm issued a 500 million ruble bond through a “blockchain settlement” system that was presumably built atop Hyperledger software. This bond was issued in cooperation with the country’s National Settlement Depository.