Central Bank of Colombia Announces First Test Program for Blockchain Bonds

Together with the participation of the Inter-American Development Bank (IDB) and Davivienda, a non-public business financial institution, the Colombian central financial institution has introduced its participation within the nation’s first pilot program for blockchain bonds.

The proof of idea will use the blockchain platform Lacchain developed by IDB, which is able to deal with the operational half of the difficulty.

Central Bank of Colombia Announces First Pilot Blockchain Bonds Program

The Central Bank of Colombia has introduced its participation within the nation’s first blockchain lending program. Published by Davivienda, one of a very powerful business banks in Colombia and with recommendation from the Inter-American Development Bank (IDB).

This is a pilot program to discover the advantages of the brand new know-how and research its software for future bond points.

According to the official announcement by the Central Bank of Colombia, these advantages embody the power to cut back working prices, optimize course of occasions, make traceability and operational safety extra environment friendly, eradicate info asymmetries and handle funds with much less danger.

The bonds are issued and managed utilizing Lacchain, IDB’s blockchain platform designed for this sort of software. The position of the central financial institution will likely be to function an observer node on the blockchain and assist the issuance of their prime quality cost system.

Although Colombia isn’t but recognized for adopting cryptocurrencies or blockchain, the nation is slowly introducing its monetary system to the thought of ​​these new applied sciences. Earlier this yr, in February, the nation’s monetary regulator, the SFC, accredited the institution of a regulatory sandbox that might permit some banks to type alliances with exchanges to course of cryptocurrency purchases in a collaborative effort. Davivienda, the financial institution taking this blockchain bond take a look at, can be included on this banking batch.

The aim of organising this sandbox is to raised perceive how the cryptocurrency system can work with conventional banking methods to legislate to adapt to this new mannequin. This reveals that Colombian regulators see cryptocurrencies as an element that’s prone to have an effect on the nation within the years to come back. However, the crypto retail enterprise in Colombia is small and has not achieved the identical degree of significance because it has in different international locations within the area akin to Venezuela or Argentina.

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