Siemens AG recently announced that it issued a digital bond worth 300 million euros, which is about 330 million dollars. This move is part of a trial run by the European Central Bank (ECB) to test blockchain technology.

Major German banks, like BayernLB, DekaBank, DZ BANK, Helaba, and Landesbank Baden-Württemberg (LBBW), invested in this bond. Deutsche Bank played a key role in helping with the settlement process.

In a blog post, Siemens shared that this issuance builds on their experience from last year when they issued a 60 million euro bond using Polygon (MATIC). That process took two days to settle. Now, thanks to new technology, they completed this latest transaction in just a few minutes. Peter Rathgeb, Siemens’ Corporate Treasurer, emphasized the potential of this technology, stating, “Automated processing within a few minutes shows the enormous potential of this new technology.”

The recent bond was settled using SWIAT, a private permissioned blockchain. This step highlights how traditional financial institutions are increasingly interested in using blockchain for things like bonds, credit, and funds. This process, known as tokenization of real-world assets (RWA), offers several benefits. It can lead to faster transactions, lower costs, and greater transparency.

Just last month, CoinDesk reported that KfW, Germany’s largest development bank, teamed up with Boerse Stuttgart Digital (BSD) to prepare for a digital bond issuance. Additionally, Italy’s state-owned development bank, Cassa Depositi e Prestiti SpA (CDP), along with lender Intesa Sanpaolo, also completed a bond issuance on Polygon in July. Both of these were part of the ECB's trials.