The European Investment Bank (EIB) issued €100 million in bonds using Ethereum technology.
The rumor was spread on Tuesday and was followed by an immediate price increase of Ethereum’s token, ether. The sale was confirmed on Wednesday by a report of the EIB and was led by Goldman Sachs, Banco Santander, and Societe Generale which served as joint managers.
“On 27 April 2021, the EIB launched a digital bond issuance on a blockchain platform, deploying this distributed ledger technology for the registration and settlement of digital bonds, in collaboration with Goldman Sachs, Santander, and Societe Generale.”EIB report
The bond sale involves €100 million in two-years notes and investors are able to buy bond tokens paying with traditional fiat currency. The notes will be recorded on a blockchain platform and have a 0% coupon.
“This transaction consists in the issuance by the EIB of a series of bond tokens on a blockchain, where investors purchase and pay for the security tokens using traditional fiat. The Joint Lead Managers will then settle the underwriting against the issuer using a representation of central money, the Central Bank Digital Currency (CBDC). The principal is expected to be repaid in commercial fiat at maturity. The transaction will use Ethereum, a public blockchain protocol.”EIB report
Ethereum on the rise
Ethereum is becoming very important as time passes; not only as a cryptocurrency but as a technology as well. At the time this article was written, ether set a new record at $2,763.02. This is catching everyone’s attention, especially from some traditional Wall Street companies, like JPMorgan that published a report titled “Why is ETH outperforming?” on Tuesday.
“In combination with the continued growth for DeFi and other components of the Ethereum-based economy, this suggests some technical but occasionally important bullish tailwinds versus bitcoin.”JPMorgan
In fact, ether has recovered much quicker than bitcoin to the latest cryptocurrency market falls.