The world of finance has taken a significant leap forward with the successful secondary market trading of the first blockchain-issued bond, marking a pivotal moment in the integration of distributed ledger technology (DLT) into global capital markets. Developed through a groundbreaking collaboration between the Commonwealth Bank of Australia (CBA) and the World Bank, the bond—known as bond-i—has now completed its first post-issuance trade using blockchain infrastructure, setting a new benchmark for digital securities.
This milestone reinforces the growing role of blockchain in finance, demonstrating how emerging technologies can streamline bond issuance, enhance transparency, and improve transaction efficiency across primary and secondary markets.
The Birth of bond-i: A Blockchain Innovation
In August 2024, the World Bank issued bond-i, becoming the first international financial institution to launch a bond fully managed on a blockchain platform. The name “bond-i” stands for Blockchain Offered New Debt Instrument, symbolizing its pioneering status in digital finance. CBA served as the sole arranger for the issuance, leveraging its internal innovation lab to design and deploy the underlying blockchain framework.
Unlike traditional bonds that rely on multiple intermediaries and paper-based processes, bond-i was created, allocated, and recorded entirely on a private Ethereum-based distributed ledger. This end-to-end digitization eliminated manual reconciliation, reduced settlement times, and enhanced data integrity—key advantages that are now being extended into the secondary market phase.
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Secondary Market Breakthrough
On May 16, 2025, the World Bank and CBA jointly announced the completion of the first-ever secondary market transaction for bond-i, conducted entirely on the same blockchain system used during issuance. This achievement makes bond-i the first bond globally to be both issued and traded in the secondary market using DLT.
The successful trade validates the feasibility of using blockchain not just for initial offerings but also for ongoing trading, ownership transfer, and recordkeeping in real time. It demonstrates that digital ledgers can support complex financial workflows beyond simple peer-to-peer transfers—including compliance checks, settlement finality, and regulatory reporting—all within a secure, transparent environment.
Hu Jingtong, Vice President of the World Bank, emphasized the importance of this development:
“Recording secondary trades on blockchain is a critical step toward enabling capital markets to harness distributed ledger technology for faster, more efficient, and more secure transactions. This progress reflects the innovation and commitment of all our partners, including investors, who have helped bring this vision to life.”
The project aligns with the World Bank’s broader strategy to explore disruptive technologies that can increase financial inclusion, reduce costs, and improve operational resilience in global debt markets.
How Blockchain Enhances Securities Management
Sophie Gilder, Head of Experimentation and Commercialization at CBA’s Innovation Lab, highlighted growing interest from financial institutions since the bond’s debut. She noted that feedback from tech and finance communities has been overwhelmingly positive, with increasing recognition that blockchain technology offers a superior digital marketplace for issuing and managing securities.
Key benefits include:
- Streamlined issuance and settlement: By automating workflows through smart contracts, blockchain reduces reliance on manual processes and third-party validators.
- Real-time transparency: All participants can view transaction histories and ownership changes instantly, improving auditability and trust.
- Improved regulatory oversight: Regulators can access permissioned views of the ledger, enabling proactive monitoring without compromising privacy.
- Reduced counterparty risk: Settlement occurs atomically—meaning delivery and payment happen simultaneously—minimizing exposure to default.
- Operational efficiency: Lower administrative burden translates into cost savings over the bond’s lifecycle.
Gilder added that CBA continues to work with strategic partners to scale these innovations across other asset classes and market segments.
Strategic Partnerships Driving Trust and Validation
To ensure legal compliance and technical integrity, several expert organizations were engaged throughout the project:
- King & Wood Mallesons served as legal counsel, providing guidance on regulatory frameworks and contract enforceability in a digital context.
- Microsoft conducted an independent code audit of the blockchain platform, verifying its security protocols and performance under real-world conditions.
- IHS Markit provided independent valuation services, ensuring accurate pricing benchmarks for both primary and secondary transactions.
These collaborations underscore the importance of cross-industry cooperation in advancing fintech innovation while maintaining investor protection and market stability.
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Frequently Asked Questions (FAQ)
Q: What is bond-i?
A: bond-i is the world’s first bond fully issued and traded on a blockchain platform. Developed by the World Bank and Commonwealth Bank of Australia (CBA), it stands for Blockchain Offered New Debt Instrument.
Q: Why is blockchain important for bonds?
A: Blockchain improves efficiency by automating issuance and settlement, reduces fraud risks through immutable records, enhances transparency, and allows real-time regulatory oversight—making bond markets faster and more secure.
Q: Who can invest in bond-i?
A: bond-i was initially offered to select institutional investors. While it is not publicly traded like stocks, its secondary market transactions demonstrate how future digital bonds could be accessible to broader investor bases via regulated platforms.
Q: Is this the future of all bond trading?
A: While widespread adoption will take time, projects like bond-i prove that blockchain is technically viable for securities management. As regulations evolve and infrastructure improves, more governments and corporations are expected to issue digital bonds.
Q: How does this affect traditional banking?
A: Rather than replacing banks, blockchain empowers them to offer faster, cheaper services. Banks like CBA are positioning themselves as innovators by building new digital capabilities while maintaining trust and compliance.
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Looking Ahead: The Road to Mainstream Adoption
The success of bond-i signals a turning point in capital markets—one where legacy systems begin to give way to modern, digital-first solutions. While still in its early stages, this initiative has sparked interest among central banks, multilateral institutions, and private sector players exploring tokenized assets.
As scalability improves and regulatory clarity increases, we may soon see government bonds, corporate debt, and even equities issued on blockchains at scale. The implications extend beyond efficiency—enabling programmable dividends, automatic tax withholding, and fractional ownership models that democratize access to capital markets.
For now, bond-i stands as a proof-of-concept turned operational reality—a beacon for how collaboration between global institutions and technological pioneers can reshape finance for the better.
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