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Ethereum Blockchain Used by Santander to Close $20-Mln Deal with Bonds

  • Yuri Molchan
    📰 News

    Spanish-based banking heavyweight Santander uses Ethereum blockchain and ERC-20 tokens for settling a tokenized debt for $20 mln

Ethereum Blockchain Used by Santander to Close $20-Mln Deal with Bonds
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Contents

As reported by CoinDesk, the Spanish major bank Santander has revealed that it has explored the opportunities offered by Ethereum blockchain on a full scale – the bank has issued tokens for a $20-mln bond and used other ERC-20 tokens that represented cash stored in a custody account to settle it. No outside investors were involved.

 A deal closed via blockchain on both sides for the first time

These days, blockchain is becoming so popular that even major banks are starting to use it for putting their deals on the digital track. However, if banks issue bonds on an open or even private ledger, they then settle them with via the traditional system of payments.

Santander has outperformed them all this time by closing the deal via blockchain on both sides.

Earlier this year, the World Bank and the French-based Societe Generale emitted a bond via Ethereum too but nothing was said about settling it via a blockchain.

Santander reps claim that every single process in that deal was done via Ethereum. They even used the Santander Security Services custody for the cryptographic keys which were used for issuing the tokenized bond and the tokenized cash used for settling it.

The bank issued a bond to itself without getting any outside investors involved.

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Details of the deal

The head of digital investment banking section at Santander, John Whelan, stated:

For Santander, this is really much more of a technology innovation issue than a pure financial issue. We regard this an important first step that will be followed by more complex transactions.”

The bond they used was a plain-vanilla one. It had a maturity for one year, four quarterly coupons and a 1.98-percent rate.

The tokenized cash and bonds were exchanged “simultaneously and irrevocably.” The cash had been kept in escrow on Ethereum using a smart contract which allowed the deal to happen once the issuer underwrote the transaction.

When asked whether the bank could technically perform the same using Bitcoin or Ether, Whelan said that it is possible but the bank does not plan to do that so far.

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About the author

Yuri is a journalist interested in technology and technical innovations. He has been in crypto since 2017. Believes that blockchain and cryptocurrencies have a potential to transform the world in the future. ‘Hodls’ cryptocurrencies. Has written for several crypto media. Currently is a news writer at U.Today.

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Bitcoin Price Likely to Decline to $7,800: Crypto Analyst

  • Yuri Molchan
    📰 News

    Bitcoin is to find support at $7,800 or recover to $8,300, an analyst writes, but either way ‘continuation of the ranging on either of the levels is going to occur’

Bitcoin Price Likely to Decline to $7,800: Crypto Analyst
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Disclaimer: The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of U.Today. Every investment and all trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.

Over the last few days, Bitcoin has been trading below the $8,500 area. At the moment, it has recovered to $8,258 after the recent slip below the $8,100 level.

Analysts have been bullish on BTC in the long run, however, the nearest BTC price movements are expected to be bearish.

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The crypto analyst @CryptoMichNL believes that there are two paths ahead of Bitcoin at the moment. If it fails to recover to $8,300, he says on his Twitter page, then the market should be ready for the flagship coin to drop and find support at the $7,800 or $7,300 levels.

Whichever way it goes, ‘continuation of the ranging on either of the levels is going to occur’.

The analyst tweeted this forecast twice with an hour pause.

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About the author

Yuri is a journalist interested in technology and technical innovations. He has been in crypto since 2017. Believes that blockchain and cryptocurrencies have a potential to transform the world in the future. ‘Hodls’ cryptocurrencies. Has written for several crypto media. Currently is a news writer at U.Today.

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