The Announcement
The Philippines Bureau of the Treasury has revealed its plan to offer 10 billion pesos ($179 million) of one-year tokenized treasury bonds. This move comes after the cancellation of the traditional auction scheduled for November 20.
Tokenized Bonds for Institutional Buyers
Institutional buyers will have the opportunity to purchase these tokenized bonds, with a minimum denomination of 10 million pesos and increments of 1 million pesos. The bonds will be valid for one year and due in November 2024. The final interest rate will be disclosed on the issuance date.
Issued by State-Owned Banks
The tokenized bonds will be issued by the state-owned Development Bank of the Philippines and the Land Bank of the Philippines.
Exploring the Potential of Tokenized Assets
When asked about the government's plans for tokenized real-world assets and bonds, Deputy Treasurer Erwin Sta stated that they will "continue to study the technology and test how far we can take it."
Growing Interest in Asian Bond Market
The Philippines' decision to issue tokenized bonds reflects a broader trend among Asian governments. Hong Kong issued $100 million in tokenized green bonds earlier this year, while Singapore has partnered with JPMorgan, DBS Bank, BNY Mellon, and investment firm Apollo to pilot tokenizing real-world assets. The United Arab Emirates has also collaborated with HSBC banks to carry out bond tokenization.
Blockchain Technology Gains Popularity
The tokenization of real-world assets using blockchain technology has gained traction among governments, following successful proofs-of-concept. Financial giants like JP Morgan and HSBC have also shown interest in this innovative solution.
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