$520B state-owned Italian bank trials digital bonds on Polygon
“This transaction demonstrates how public blockchains are a powerful technology for financial institutions, making transactions faster and safer,” Niccolò Bardoscia, head of digital assets trading and investments at Intesa Sanpaolo explained in a July 18 LinkedIn post
Italy’s state-owned bank Cassa Depositi e Prestiti SpA has just completed a $27.2 million digital bond issuance with trillion-dollar investment bank Intesa Sanpaolo using Ethereum layer-2 Polygon.
The transaction was part of a trial conducted by the European Central Bank to identify new solutions for central bank money settlement of wholesale transactions carried out on blockchains, Intesa Sanpaolo explained in a July 18 statement.
It was the first transaction of its kind since Italy introduced its FinTech decree law, which governs the issuance and circulation of financial instruments in digital form.
Cassa Depositi’s $27.2 million (25 million euro) bond will mature over four months — terminating on Nov. 18, 2024 — and offers a fixed coupon at 3.63%, calculated on an annual basis. Intesa Sanpaolo was the sole institutional investor in the trial.
The cash flow was settled the same day via the Bank of Italy’s "TIPS Hash Link” tool that allows interoperability between blockchains and traditional payment rails.
“This transaction demonstrates how public blockchains are a powerful technology for financial institutions, making transactions faster and safer,” Niccolò Bardoscia, head of digital assets trading and investments at Intesa Sanpaolo explained in a July 18 LinkedIn post.
“This technological change will impact not only bonds but every asset class over the coming years.”
