Bank of Thailand has issued the world’s first blockchain-based government savings bond platform
Bank of Thailand (BOT), the central bank of the country has successfully launched the world’s first blockchain-based platform for government savings bonds issuing a total of $1.6B USD within two weeks using IBM’s blockchain technology.
According to the press release on October 5, the platform allows investors to benefit from speedy bond issuance, reducing a process that previously took 15 days to two days. The efficiency provided by blockchain also reduces operational complexity and the overall cost of issuing bonds.
The outstanding Thai bond market stood at $421B USD as of December 2019. Government bonds dominate the Thai market, with outstanding value of $157B USD in 2019 1, accounting for 37% of the total outstanding Thai bond market.
IBM along with the central bank collaborated with seven other institutions including Public Debt Management Office, Thailand Securities Depository Co., Thai Bond Market Association and four other banks.
“Bank of Thailand’s success with the government savings bond project is the latest example of how blockchain technology can redefine the way businesses operate by simplifying complex processes resulting in fast, transparent, secured and efficient multiparty collaboration,” said Patama Chantaruck, VP for Indochina Expansion and MD of IBM Thailand. “IBM is proud to bring our world-class blockchain platform and IBM Cloud to support Bank of Thailand, and work side-by-side with them in achieving this important milestone for Thailand’s financial industry.”
The Bank of Thailand may soon extend the use of blockchain technology across all other government-issued bonds for retail and wholesale investors.
Back in July, the bank was also to be planning to use its digital currency to transact with the Hong Kong Monetary Authority.
Thailand is an active adopter of blockchain technology, with a dynamic ecosystem extending to both public and private spheres. In 2019, the electronic letter of guarantee (eLG) platform and network participated in by 22 Thai banks and 15 companies successfully went live and currently handles approximately $300M USD in guarantee letters.
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