A blockchain-based trading platform for a digital stock will be put to the test by Tel Aviv Stock Exchange. This will be in collaboration with the Israeli Ministry of Finance and VMware, a US software solution provider.
Also, FireBlock, a provider of digital asset custody, will take part in the process. These equities are made available by Israel’s federal ministry of finance.
Israel Disclosed Reasons why Creating Digital Bond Is Very Necessary
The news was announced on October 19 by the Israel stock exchange authority. Eden is the name of the project. The cost of national bonds will be kept to a minimum when the project is developed. The project also seeks to streamline the nation’s national stock acquisition procedures.
Yali Rothenberg, Israel’s Accountant General, broke the news to the general public. He stated that he thinks blockchain-based technologies will someday permeate our daily lives. He went on to say that innovations based on blockchain will have a substantial impact on the economy’s and the financial sector’s influential sectors.
Reviewing Israel’s decision is Yale’s responsibility, along with that of the ministry of finance. They would regularly review and update cutting-edge technology and procedures in the country.
All financial entities involved will receive a new set of tokenized government stocks in their online wallets. This will be done through the project medium while the test-running of the project is still in progress. The funds in digital currencies will be transferred to the Israeli federal government’s digital wallet.
There is currently no specification regarding the digital item used for the live testing. By the end of the first quarter of 2023, the authorities hope to have finished the project.
What Inspired The Quest For Bond Digitalization?
Few countries or international organizations have succeeded in digitizing their stock. This concept was pioneered in 2018 by Australia’s Commonwealth Bank and the World Bank for Development and Reconstruction.
$110 million was allocated for the two-year blockchain stocks by these projects. The Investment Bank of Europe followed suit and invested 100 million euros into digital equities.
El Salvador is the most well-known country that has experimented with bond tokenization by implementing digital government stocks. Colombia and the Philippines have also explored the idea. El Salvador links its “Bitcoin bonds” to a larger crypto-centred economic plan.
In 2022, the UK said it would look into using blockchain technology for government assets.