Thailand launches world’s first blockchain savings bond
The Bank of Thailand has launched the world’s first blockchain platform for government savings bonds, issuing $1.6 billion worth of the debentures during the past two weeks using a system developed by IBM as Thai regulators continue to embrace financial technology.
“The Bank of Thailand’s success with the government savings bond project is the latest example of how blockchain technology can redefine the way businesses operate,” said Patama Chantaruck, Managing Director of IBM Thailand. Blockchain is “simplifying complex processes resulting in fast, transparent, secured and efficient multiparty collaboration.”
The sale of government savings bonds is usually a complicated, multiparty, time-consuming process that relies on a non-real-time system, with duplicated validation steps and manual reconciliation prone to data errors.
Central bank executives said the new platform was working so well that they plan to use it for all other government bond sales. Aside from being a participant in the financial markets, the Bank of Thailand also regulates the banking system.
The Bank took a cautious approach to blockchain when the technology became available. It set up a “sandbox” where commercial banks could develop and test their own blockchain-based systems without subjecting the financial system or their customers to undue risk.
Starting last year, many Thai commercial banks have been using blockchain for some live transactions in the wider marketplace. A consortium of 22 Thai commercial banks and 15 corporations began issuing the world’s first blockchain Letter of Credit, a crucial tool in facilitating business and trade.
Meanwhile, Thailand’s Customs Department became the second government agency in Southeast Asia to adopt TradeLens. This blockchain-based global trade digitization platform improves the speed, accuracy, and security of local and international shipping activities.
Photo courtesy of https://www.bot.or.th/