NBC and JP Morgan test debt issuance on blockchain
Blockchain news time!
National Bank of Canada (NBC) and JP Morgan have tested blockchain technology for debt issuance. Consultancy firm Synechron provided business and technology consulting for the project.
NBC issued a $150 million, one-year floating-rate Yankee certificate of deposit, with a parallel simulation of the issuance using blockchain technology. Goldman Sachs Asset Management, Pfizer, and Western Asset were among the investors in the Yankee certificate of deposit.
The simulation test had the banks mirror the execution of the actual transaction through a debt issuance application developed by JP Morgan, based on Quorum – a permissioned-variant of the Ethereum blockchain.
Quorum was developed by JP Morgan and unveiled in 2016. The bank is now planning to spin off the business as a standalone entity.
Christine Moy, blockchain programme lead at JP Morgan, says the project with NBC is “an exciting example” of how the bank can leverage its “combined capabilities in capital markets and blockchain technology”.
The solution incorporates functions across the complete debt instrument transaction lifecycle, including origination, distribution, execution, settlement, interest rate payments, and maturity repayments.
