Slovenia has become the first European Union country to issue a digital sovereign bond.
The bond, facilitated by BNP Paribas, marks a new chapter in the integration of blockchain technology with traditional financial instruments.
On July 25, Slovenia issued a bond worth 30 million euros ($32.5 million), offering a 3.65% coupon rate and set to mature on November 25.
The issuance was conducted through BNP Paribas’ Neobonds platform, which leverages distributed ledger technology (DLT).
This platform uses Digital Asset’s Daml language on the Canton blockchain, ensuring secure and efficient transaction processing.
Settlement was handled by the Banque de France’s DL3S interoperability system.
This initiative is part of the European Central Bank’s (ECB) wholesale central bank money settlement experimentation program, which entered its second phase in June.
The program includes three interoperability solutions: France’s DL3S, Deutsche Bundesbank’s Trigger Solution, and Banca d’Italia’s TIPS Hash-link.
Philippe Maillard, Chief Operating Officer of BNP Paribas CIB, highlighted the collaborative effort across multiple business lines that made this digital bond issuance possible.
Beyond Neobonds, BNP Paribas also operates the AssetFoundry, a tokenization platform based on Ethereum.
The move towards digital bonds is gaining traction globally.
The World Bank issued the first blockchain bond in 2019, followed by the People’s Bank of China later that year.
In 2023, Hong Kong issued a $100 million tokenized green bond, and recently, Palau partnered with Japanese blockchain company Soramitsu for a government bond platform.
Austria and Italy have also been active in this space. Austria simulated a digital bond settlement in May, while Italy’s state-owned Cassa Depositi e Prestiti issued a $27.2 million digital bond on Polygon using the TIPS Hash-link solution.
