- Central Bank Of Colombia Launches Blockchain Bond Project
- The blockchain bonds will be issued and managed using Lacchain.
- Colombia has not been aware of its adoption of cryptocurrencies.
Central Bank of Colombia, IDB Group, and Banco Davivienda have launched the pilot of Colombia’s first blockchain bond. According to the official statement by the Central Bank of Colombia, the blockchain bond will issued, placed, traded, and settled on blockchain technology through the use of smart contracts for the Colombian securities market.
Moreover, IDB Group, composed of the Inter-American Development Bank, the Inter-American Investment Corporation, and the Multilateral Investment Fund.
Accordingly, the Central Bank of Colombia pilot scheme looks to verify the advantages of this new technology in the life cycle of security, from issuance to maturity, also expected to last six months, Central Bank of Colombia stated.
More so, the blockchain bonds will issued and managed using Lacchain, IDB’s blockchain platform that developed to support. The part of the central bank will be to run an observing node in the blockchain and support the issuance in its high-value payments system.
Further, Colombia has not been aware of its adoption of cryptocurrencies or blockchain, the country is rapidly introducing its financial system to the idea of these new technologies. In February, the financial watchdog of the country, the SFC, legalized the improvement of a regulatory sandbox that allowed some banks to establish alliances with exchanges to process cryptocurrency purchases in a group effort. Davivienda, the bank involved in this blockchain bond trial this also included in the batch of banks.
Hence more, IDB Group will contribute technical support for the implementation of the proof of concept, and offer advice on both regulatory and technical aspects of the operation.