” . Capital markets • News State-owned KfW issues CHF 140m digital bond via SDX 19 hours agoby Ledger Insights German state-owned bank KfW has issued a CHF 140 million digital bond via the SIX Digital Exchange, with settlement using a wholesale CBDC. It marks the third issuance on the platform since May, with the City of Lugano and SIX both launching securities. UBS was lead manager of the 7 year 0.3725% bond. “This bond issue underscores our progress towards modern capital markets and consolidates our role as a driving force of innovation. It also serves as a testament to KfW’s clear focus on digitalization and ongoing development,” said Petra Wehlert, Head of Capital Markets at KfW. KfW has been fairly prolific with digital bonds, potentially matching the European Investment Bank’s range of digital bond innovations. Germany’s Electronic Securities Act (eWpG) has a concept of centralized issuance using a central securities depository (CSD) versus decentralized crypto securities that use blockchain and registrars instead of CSDs. The bank has done at least €17.5 billion in ‘digital’ bond issuances on Deutsche Börse’s D7 platform. From a legal perspective, Deutsche Börse Clearstream is a centralized CSD, so these issuances are not crypto securities. But the technology that underpins D7 is blockchain and the stock exchange is slowly testing the waters on the crypto securities front. Apart from these large issuances, KfW has issued two crypto securities. One of them was a €100 million digital bond. The second was part of the ECB’s wholesale DLT settlement trials, with the €50 million bond settled using central bank money via Germany’s Trigger solution, which is expected to become more widely available soon. Both bonds used the Polygon public blockchain and were redeemed within months. These experimental issuances contrast with KfW’s latest CHF bond, which utilized an established digital platform. SIX Digital Exchange in name only The offering was originally called the SIX Digital Exchange (SDX) because it had two licenses – one as a securities exchange and another as a CSD. In reality most bonds had dual listings on both SDX and the main SIX exchange. Likewise, most bonds are natively issued on the SDX CSD, which is linked to the SIX CSD to enable easy integration for those institutions that are not up to speed with DLT. However, following the SDX being merged into the SIX securities services group earlier this year, the exchange part of SDX is being shuttered, with the last trading day at the end of May. Image Copyright: KfW blockchain blockchain bonds bonds Central Bank Digital Currency digital assets digital bonds distributed ledger DLT KfW SDX SIX SIX Digital Exchange tokenization tokenized bonds wCBDC wholesale CBDC FacebookXRedditEmailLinkedInWhatsApp . ”
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