Bank of China releases $28 million in digitally structured notes on the Ethereum blockchain

By: Ikenna Odunze

June 13, 2023 5:09 AM

Regulators in Hong Kong and Switzerland oversee the security tokens.

On June 12, the investment bank affiliate of Bank of China, BOCI, announced→ the issuing of 200 million Chinese yuan ($28 million) in digital structured notes produced on the Ethereum blockchain. BOCI is the first Chinese financial institution in Hong Kong to issue a tokenized security. UBS, an investment bank, assisted in developing the product for distribution to a client in the Asia-Pacific area. BOCI's vice CEO, Ying Wang, commented:

"By developing blockchain-based digital structured products designed specifically for Asia Pacific customers, we are driving the simplification of digital asset markets and products for customers in Asia Pacific."

At the same time, UBS has been increasing the number of its structured products, fixed income, and repo financing that are tokenized. The company tokenized a $50 million fixed-rate note in December 2022, digitalizing it on a permissioned blockchain and subjecting it to English and Swiss legislation.

As previously reported, Hong Kong opened retail crypto exchange access on June 1. Approximately two weeks later, Joseph Chan Ho-Lim, the government of Hong Kong's under-secretary for financial services and the treasury, stated→ that the special administrative region is "actively participating" in the blockchain industry and plans to establish a framework for stablecoin regulation within a year.

With a yearly yield of 4.05%, Hong Kong issued a HK$800 million green bond on Goldman Sachs' GS DAP tokenization protocol on February 16th. Over $70 million was amassed prior to the debut of two cryptocurrency exchange-traded funds in Hong Kong in December 2022.