Slovenia just pulled off a major first. It's the first EU country to issue a sovereign digital bond. The bond is worth €30 million. That's about $32.5 million. It offers a 3.65% coupon. The Slovenian government announced this officially. The bond matures on November 25, 2024. It was settled on-chain. This used the Bank of France's tokenized cash system. Digital bonds are different from traditional ones. They use blockchain tech. This makes them more transparent, efficient, and secure. Digital bonds are catching on. In 2019, Société Générale issued a €100 million blockchain bond. Vonovia, a big German housing company, did it too. In 2021, they issued €20 million in digital bonds. Even China's central bank got in on the action that year. Italy's not far behind. Cassa Depositi e Prestiti SpA and Intesa Sanpaolo just did their first blockchain bond. The European Central Bank (ECB) is all over this trend. They're testing wholesale central bank digital currencies (CBDCs). In May, the ECB ran a test with Austria's central bank. They looked at tokenizing government bonds. BNP Paribas handled Slovenia's bond issue. They were the global coordinator and sole bookrunner. "This is a big deal," says Robinson Rouchie, CIO at BNP Paribas. He's talking about systematic and quantitative investments. "We're all in on new tech and shaking things up in asset management." BNP Paribas used their Neobonds platform for this. It's a private tokenization platform. They built it using Digital Asset's Daml and the Canton blockchain. It's pretty nifty. It handles everything from legal ownership to coupon generation. These digital bonds could really shake things up. They make markets more transparent and efficient. Issuing and settling bonds gets faster, safer, and cheaper. This could mean more liquid markets and quicker transactions. It's not just about the tech, though. This move signals a shift in EU finance. Slovenia's taking the lead in modernizing financial markets. They're using distributed ledger technology (DLT) to do it. The ECB's been busy too. They've been running experiments on wholesale CBDCs. These tests are crucial. They help us understand how CBDCs could revolutionize financial markets. Slovenia's digital bond is just the latest step in this ongoing revolution.

Italy's state-owned bank CDP has taken the plunge into blockchain technology. They've just rolled out their first digital bond on the Polygon network. CDP teamed up with Intesa Sanpaolo, Italy's biggest bank, for this groundbreaking move. The bond is worth €25 million and will mature in 4 months. It's not just a random experiment. This is part of a bigger European Central Bank (ECB) trial. The ECB is testing ways to settle wholesale fiat money on blockchains. The bond pays a fixed annual coupon of 3.633%. That's not too shabby in today's market. They didn't just use any old payment system. The Bank of Italy's TIPS Hash Link solution was the go-to. It bridges the gap between blockchains and traditional payment systems. CDP's finance boss, Fabio Massoli, is pretty chuffed about it. He called it a "significant step" in capital market innovation. This isn't just a one-off. The project aims to set up a new tech model for digital bond issuance. It'll stick to the new legal and regulatory framework. It's not just CDP jumping on this bandwagon. Big players worldwide are eyeing tokenization of traditional financial instruments. Take BlackRock, for instance. The world's largest asset manager kicked off asset tokenization in March. They launched a digital liquidity fund. Why the hype? It's all about the benefits. Lower costs, faster settlements, and more transparency are the big draws. Intesa Sanpaolo's digital assets guru, Niccolò Bardoscia, is all in. He reckons public blockchains are a "powerful technology" for banks. Bardoscia didn't mince words. "Tokenization is establishing a new standard for efficiency and automation in financial markets," he said. He's not stopping at bonds either. Bardoscia thinks this tech shake-up will hit every asset class in the coming years. So, there you have it. Italy's state bank is riding the blockchain wave. It's a brave new world for bonds, and CDP is leading the charge.

Ethiopia takes first step toward a central bank digital currency (CBDC) in a revolutionary economic reform. The country plans to have a legal framework and regulatory sandbox in place for CBDC introduction. The National Bank of Ethiopia (NBE) has prepared a proclamation that includes the establishment of a legal framework for introducing CBDC. The policy changes foreseen by the NBE Proclamation include creating a legal framework for a CBDC. Other measures described in the document include increasing the NBE’s capital and creating a legal basis for consumer protection. The bank also expects that CBDC implementation will require some liberalization of foreign investment in banking. NBE also thinks about a regulatory sandbox for innovative financial solutions. The Council of Ministers has approved the proclamations and will soon be introduced into the House of Representatives. Talking about CBDCs may be a next significant step in economic liberalization of Ethiopia. The country already uses blockchain-based digital infrastructure for large government payments. Several African countries are pushing for crypto adoption. Even such a barrier as low internet penetration can't stop them. Those experiments aren't always fast and a 100% successful. For example, Nigeria launched its own CBDC called eNaira in 2022. The Central African Republic adopted Bitcoin as a currency and launched a non-CBDC government cryptocurrency called the Sango. Yet, there are no news on the Sango currency really working, as of now. Zimbabwe has recently started to use a government-issued gold-based token as the foundation for the introduction of the latest currency.

Israel has taken a significant step forward in its financial technology sector by launching a central bank digital currency (CBDC) experiment. Despite the ongoing conflict, the Bank of Israel (BoI) is forging ahead with the digital shekel project. The aim is to develop an advanced digital payments ecosystem. Inspired by the Project Rosalind of the BIS Innovation Hub, the BoI's initiative, known as the “Digital Shekel Challenge,” will involve various service providers. The experiment includes creating real-time CBDC payment systems for the general public, using a sandbox environment equipped with application programming interfaces. Participants will undergo a three-phase program: application and presentations, access to the new network for selected projects, and a final presentation judged by experts. This initiative aims to bridge the gap between the Web3 industry and government. It’s obviously worth mentioning that Israel continues to develop its CBDC project despite the ongoing full scale war. Entities from private, public, and academic sectors are invited to participate. Priority will be given to innovative payment solutions, whether they improve existing applications or introduce new ones. While the CBDCs are designed for universal use, unique niche solutions are also encouraged. Deputy Governor Andrew Abir supports the development of the digital shekel, seeing it as beneficial for both the public and the BoI. He believes that the transparency and accountability of the digital shekel will gain public trust. However, concerns about privacy breaches remain. A public consultation confirmed broad support for CBDC research but highlighted potential privacy issues. Despite these challenges, the BoI is determined to advance its digital currency initiative amidst the current adversity.

The U.S. House of Representatives has thrown a wrench into the Federal Reserve's plans for a central bank digital currency (CBDC). What a surprise after all these years of endless discussions, right? Critics of the very idea of a digital dollar can rejoice. The bill bans the Fed from issuing a CBDC. And it passed with a solid majority, Coindesk notes. Representative Tom Emmer, a vocal critic of the digital dollar, argues that a CBDC could undermine financial privacy. He is afraid that too much power will be concentrated in the hands of the federal government. The House's decision marks a significant pushback against the growing trend. Many countries around the world are steaming ahead. Just look at European Central Bank and China’s People's Bank with their digital currency initiatives. America still trails behind, as we all see now. And there is no sign of U.S. catching up. The bill’s success in the House shows the skepticism among lawmakers about the Fed's digital ambitions. Many of them fear it's the Orwellian future we are talking about. Fed-issued CBDC could lead to increased surveillance and control over individuals' financial transactions, they say. Proponents of a CBDC have a decent response here. They believe it could modernize the financial system, making transactions more efficient and secure. However, the future of this bill is anything but certain. It now heads to the Senate, where the dynamics are more complex. The debate over CBDCs is not just about technology; it's about trust. Trust in the government, the financial system, and the balance between innovation and privacy. As the Senate prepares to take up the bill, these issues will undoubtedly fuel heated discussions. For now, the House has made its stance clear. The Federal Reserve's digital dollar is on hold. Sorry, folks, but we are about to let China go ahead. To Orwellian future, probably. But that remains to be seen.