Singapore’s OCBC Bank has launched a blockchain-based solution that allows corporate clients to invest in fractionalized tokenized bonds, marking a shift in corporate finance management.
The bank’s accredited investors, defined as entities with more than S$10 million ($7.3 million) in assets, can now purchase bond units starting at S$1,000 – a significant reduction from the traditional minimum of S$250,000, according to Ledger Insights.
The new solution also allows investors to adjust the term and coupon rate of bonds. These tokenized bonds reference existing investment-grade assets, providing corporate clients with more customized and liquid investment options.
For example, a mid-sized construction company recently used the service to diversify its government bonds beyond fixed deposits, Ledger Insights reported.
Settlement times have also improved, with transactions now taking just one day compared to the usual five days.
This initiative builds on OCBC’s previous blockchain projects. In 2023, the bank partnered with ADDX to issue structured products and introduced a conditional payment solution using blockchain. The system facilitated automatic disbursements for the Land Transport Authority and processed more than S$22 million in payments by the end of 2024.
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Global banks and tokenization
Global banks are beginning to explore tokenization for financial transactions. Last fall, the Reserve Bank of Australia launched a consultation on Project Acacia, a three-year initiative exploring large-scale central bank digital currencies and tokenized asset markets.
The project sought public feedback on the potential benefits of tokenizing assets and using CBDCs for settlement.
Also, the German state bank, Kreditanstalt fuer Wiederaufbau, started using blockchain technology in June 2024 with its first digital bond.
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