The Bank of China has recently issued blockchain-based bonds worth 20 billion Chinese yuan ( $2.8 billion), which it has sold to fund micro-enterprise and small businesses, according to the China Development Network.

This issuance of $2.8 billion in blockchain-based bonds was along the expected lines, given the bank’s loan balance worth 404 billion yuan for small and micro-enterprise so far this year — representing 35.36% growth at the end of the previous year and catering around 410,000 small-owners and micro-enterprise.

About The Bond

The issuance of these $2.8 billion bonds was not in a standard way. Instead, the Chinese central bank organized this affair using the blockchain technology. This issuance looks quite surprising, as one acknowledges China’s stance on the decentralization. China’s own-developed issuance system for blockchain-based bonds was exhibited for the first time, and it will handle the monitoring and administration of these two-year bonds with a 3.25% Coupon rate.

Vigilant Enthusiasts Confirm China’s Inclination For Decentralization

Earlier, innovations on blockchain technology and cryptocurrencies have been stifled in China to the extent that complies with the country’s zero-tolerance playbook. In 2017, China banned Bitcoin (BTC), and after that, it shuttered exchanges, which had precedent and meant to subdue capital flight. But after that, it closed all potential ICOs, which led to the extinction of cryptocurrency.

Now, China’s ban on blockchain technology seems to be more about control rather than ideology. It is a safe guess acknowledging that in terms of both cryptocurrency and blockchain technology this year saw China launch its seminal Central Bank-issued cryptocurrency (CBDC) and blockchain bond issuance system.

The declaration for CBDC proves that China has never genuinely ignored decentralized technology, just outwardly. The other consecutive clue is its issuance of blockchain-based bonds in this favour, with the system making use of superior data-tracking capabilities of blockchain technology and not anything that seems risky. Blockchain does for bonds what a national stablecoin does for fiat: cost-efficiency while leaving the riskier aspects of crypto at the door. Blockchain makes the bonds cost-efficient and leaves the riskier aspects of a crypto application on the floor.

source>>https://www.cryptoknowmics.com/news/china-issues-blockchain-based-bonds-worth-2-8-billion