Today, Wirtschafts und Infrastrukturbank Hessen (WIBank), the German development bank owned by Helaba, issued a bond registered on a public blockchain. The settlement was carried out in a delivery versus payment (DvP) transaction using the Bundesbank’s Trigger solution, which initiates settlement on the TARGET2 payment system. The €5 million transaction was part of the Eurosystem’s large DLT settlement trials.
Exchanging digital bonds and cash simultaneously eliminates counterparty risk and using central bank money reduces credit risk.
“The experience gained from this project opens up new possibilities for the further development of existing financial products in conjunction with innovative technologies. This minimizes risks and optimizes processes both for us and for our investors,” said Christian Forma, Head of Treasury at WIBank.
Cashlink provided the tokenization and settlement infrastructure, with Helaba acting as cash settlement agent. Bankhaus Metzler was the investor, with Deloitte helping with implementation and Annerton providing legal advice.
As with many Cashlink issuances, the transaction used the public Polygon blockchain.
The ECB’s wholesale DLT settlement trials offer three settlement solutions. These include the German Trigger solution, the Italian TIPS Hashlink solution which installs on the TIPS payment system and the French wholesale CBDC.
Yesterday, an ECB director announced plans to create a European ledger and confirmed the central bank was considering plans after DLT wholesale settlement trials end next month.
Update: addition of the blockchain and the issue amount
