According to CoinDesk, Italy’s state-owned development bank Cassa Depositi e Prestiti SpA (CDP) and the country’s largest lender Intesa Sanpaolo have completed the first blockchain-based digital bond issuance. The €25 million bond was issued on the Polygon (MATIC) network on Ethereum with a term of four months, and Intesa Sanpaolo was the underwriter and sole investor.
The bond's cash flows were settled in euros on the same day through the Bank of Italy's "TIPS Hash Link" tool, enabling interoperability between blockchain and traditional payment systems. This is Italy's first digital bond issuance under the "Fintech" decree, which governs the issuance and circulation of digital versions of certain financial instruments.
The issuance is part of the ECB’s trial of wholesale fiat currency settlement on a blockchain. Global banks and asset managers are increasingly exploring putting traditional financial instruments such as bonds, credit and funds on blockchain to achieve faster and more transparent transaction settlement, lower costs and greater efficiency.
Niccolò Bardoscia, head of digital asset trading and investment at Intesa Sanpaolo, said the transaction demonstrated the powerful technology of public blockchain in financial institutions, making transactions faster and safer. He believes that the tokenization of assets will bring new efficiency and automation standards to the financial market and will affect all asset classes in the coming years.