Financial markets are finally leveraging blockchain

economictimes.indiatimes.com:

blockchain technology. Even amid the turmoil set off by interest rate hikes and quantitative tightening, the global bond market, which is bigger in size than equities yet off the radar for retail investors, appears to have earmarked 2023 to leverage blockchain technology. A few days ago, Switzerland-based Obligate executed a corporate bond issued by a Swiss commodity trading firm on Polygon’s blockchain platform, thus marking the first bond issuance that involved no intermediary or traditional rails. The bond was issued and executed by the smart contract. Earlier in February, the Hong Kong government issued the world’s state-issued tokenized green bonds worth $102 million using blockchain technology as part of its push to restore its status as a global financial hub. In Germany, engineering giant Siemens issued its first digital bond, worth $64 million, on a public blockchain.

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This step toward on-chain assets is a big leap forward for the bond markets—and capital markets, in general. Issuance of assets on-chain significantly reduces the settlement time. For instance, a pilot tokenized bond issuance by the European Investment Bank found that the use of blockchain could reduce settlement time from five days to a single day — or, T+0 in industry parlance. A faster settlement has further knock-on benefits: It reduces liquidity risks and improves market efficiency.Tokenization also paves the way for further