Austrian Government to Auction $1.3 Billion Worth of Bonds on Ethereum Blockchain

In an unmistakable milestone for blockchain, the Austrian Treasury is to issue government bonds worth €1.15 billion ($1.3 billion) on Ethereum, claiming the largest smart contract platform by market capitalization brings about “added security” and a “high level of confidence” in the nation’s bond auctions.

Come Tuesday 2nd October, the bonds are to be auctioned off by local banking giant Oesterreichische Kontrollbank (OeKB) on behalf of the Austrian government, a Ministry of Finance press release reports.

The bank is to act as a “neutral capital-market participant” for the treasury, deploying notarization data to the blockchain as hash values and has claimed the auction follows a series of successful trials. OeKB Executive board-member Angelika Sommer-Hemetsberger noted:

“Blockchain technology offers great potential for increasing efficiency and assuring quality in bank processes. For this reason, we have indeed been engaging intensively for some time with this topic and have already tested several prototypes. Launching live operations at this point, on behalf of the Austrian Treasury, represents a gratifying and logical next step.”

Bullish on Blockchain

First manifesting itself as a technological uprising against banks and state-led finance, blockchain seems to have become an unlikely hero for some.

The Austrian government appears to have become the young stud’s latest suitor, all but waxing lyrical about the merits of blockchain in the announcement, deeming it a “non-manipulable system for securing and transferring information” and as forming a “focus of economic policy.”

Marcus Stix, Managing Director of the Austrian Treasury went on:

“This added security contributes to achieving a high level of confidence in the auction process for Austrian government bonds and strengthens Austria’s good standing in the market, which indirectly also has the capacity to contribute to favourable financing costs.”

Austria wouldn’t stand alone as a lone courter, however. Similar developments have been brewing down under, with the Commonwealth Bank of Australia being handpicked by the World Bank to conduct blockchain-based bond transactions.