The € 100 million digital bond was a test for a CBDC, according to Banque de France

It turns out that the EUR 100 million digital bond issued by the European Investment Bank earlier this week was actually a test of a digital currency from the European Central Bank (CBDC).

An announcement by the French central bank on Thursday, Banque de France announced that the digital loan was processed using a CBDC on a blockchain network.

The two-year bond was issued on the public Ethereum blockchain on Tuesday and settled the next daywith an expiration date of April 28, 2023. The sale was led by Goldman Sachs, Santander and Societe Generale.

The € 100 million digital bond was a test for a CBDC, according to Banque de France
The € 100 million digital bond was a test for a CBDC, according to Banque de France

“From a technological point of view, the experiment required the development and deployment of smart contracts in secure conditions so that the Bank of France could issue and control the proliferation of CBDC tokens and the transfer of CBDCs at the same time as the delivery of security tokens to the investor’s portfolio “said the Bank of France.

The bank also announced its plans to conduct more experiments in the future, noting that their efforts are part of a push to provide use case testing for a European CBDC:

“In the coming months, and in collaboration with the marketplace, the Bank of France will conduct additional experiments to evaluate other uses of the central bank’s digital currency for interbank settlement.”

The news that the EIB had issued the bond in Ethereum increased the price of Ether (ETH) at $ 2,709 on Wednesday. Danny KimReuters, Head of Revenue at Cryptocurrency Broker SFOX, told Reuters The announcement “sparked a bullish institutional use case for Ethereum”.

Despite the upward trend in Ether, the wait for a digital euro may still take some time. as the European Central Bank did not participate in the pilot project.

In January of this year, the President of the European Central Bank, Christine Lagardesaid that the development of a digital euro “It’ll take a while to make sure it’s safe.”and added: “I wouldn’t expect it to be more than five years.”.

On April 12th the head of ConsenSys in South Africa, Monica Singer warned that if Europe is too slow to pull the trigger, it may be left behind::

“If the European Central Bank will wait until 2028, there will be no central bank. Because who will use the euro in its current form? There will be many options.”

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