Italy’s state-owned development bank Cassa Depositi e Prestiti SpA (CDP) and Intesa Sanpaolo, the largest lender in the country, successfully completed a milestone digital bond issuance using blockchain technology. The €25 million bond with a four-month maturity was issued on the Ethereum-based Polygon (MATIC) network, with Intesa Sanpaolo acting as the underwriter and sole investor.
The transaction was settled in euros on the same day (T+0) utilizing the Bank of Italy’s ‘TIPS Hash Link’ tool, enabling interoperability between blockchains and traditional payment systems. This marked the first digital bond issuance under Italy’s ‘FinTech’ decree-law, which regulates digital financial instruments.
The issuance was part of the European Central Bank’s (ECB) initiative to explore blockchain-based settlement solutions for wholesale fiat money transactions. The collaboration between CDP and Intesa Sanpaolo highlights the increasing trend among global financial institutions to leverage blockchain technology for enhanced operational efficiency, transparency, and cost-effectiveness.
Niccolò Bardoscia, Head of Digital Assets Trading and Investments at Intesa Sanpaolo, emphasized the significance of public blockchains in revolutionizing financial transactions. He stated that tokenization is reshaping financial markets by introducing new standards for efficiency and automation, not limited to bonds but extending to various asset classes in the future.
The successful digital bond issuance in Italy underscores the growing adoption of blockchain technology in the financial sector and sets a precedent for further innovation and digitization within the industry.