The basis for this issuance was Corda, R3’s digital ledger technology (DLT) platform that offers a sustainable infrastructure for digitally native notes.
In a first, the World Bank has listed the “first digital native security” or “digital native note (DNN)” on the Luxembourg Stock Exchange (LuxSe). The €100 million DNN, listed on the Luxembourg Stock Exchange, is a key element of a more extensive endeavor to create a sustainable digital infrastructure for DNN issuance. The issuance happened through the involvement of Citi’s Issuer Services in the role of the issuing and paying agent, while TD Securities acted as the dealer.
Digitally Native Notes
The basis for this issuance was Corda, R3’s digital ledger technology (DLT) platform. Euroclear’s D-FMI connects with its conventional settlement platform for secondary market activities on the DNN. This further signifies a noteworthy achievement in the global financial market’s digital evolution.
This effort is a component of a comprehensive, multi-year program that encompasses major players like Citi, Euroclear, TD Securities, and IBRD. The primary objective is to establish a scalable framework that combines the advantages of digitization with bond accessibility and liquidity. Ultimately, this program will lay the foundation for a fully digital transaction lifecycle in the realm of debt capital markets.
Additionally, adhering to its innovation-focused strategy, Citi persists in advancing digital asset solutions through shared technological capabilities. These improvements also encompass various aspects of Citi’s offerings, such as digital currencies, trade securities, custody services, asset servicing, and collateral mobility.
As of now, Citi Securities Services oversees assets valued at around US $28 trillion, providing custody, administrative, and trust services. The institution offers cross-border support combined with local market proficiency, innovative post-trade technologies, and an extensive array of securities services solutions.
Luxembourg Exchange (LuxSE) Embracing Digital Securities
LuxSE views the listing of digital securities as a natural progression and a testament to its broader endorsement of digital securities. In 2022, LuxSE also achieved the distinction of being the first exchange in the EU to admit digital securities issued by Societe Generale on its Securities Official List, known as LuxSE SOL.
Subsequently, it extended this achievement by accepting three digital securities issued by the European Investment Bank, among them the world’s pioneering digital Climate Awareness Bond, added to LuxSE in June this year.
Arnaud Delestienne, Director of International Capital Markets and a Member of LuxSE’s Executive Committee, described the introduction of digital bonds and the D-FMI platform as a significant stride toward the development of digital securities markets. He emphasized the organization’s unwavering belief in the potential of distributed ledger technology to enhance capital markets.
LuxSE anticipates that the widespread adoption of distributed ledger technology (DLT) will considerably improve global debt capital markets, yielding cost reductions, expediting processes, and enhancing transparency, thereby benefiting market participants.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
