China Construction Bank (CCB) has partnered with digital asset exchange, Fusang to issue $3 billion worth of debt securities on a blockchain. Announced on Wednesday, this is the first digital securities offering on a blockchain by any Chinese bank.
The bond is called Longbond SR Notes and will be directly available to the retail investors.
Usually, Chinese bonds are only accessible to institutional and professional investors with a minimum investment amount of tens of thousands of yuan. However, the Longbond’s can be bought for merely a minimum of $100.
These bonds will offer a 0.75 percent yield at maturity, much higher than the average rate of 0.25 percent on the bonds of other Chinese banks.
“Issuers no longer need to operate in a fragmented environment with multiple process flows as FUSANG’s end-to-end platform streamlines their needs, from issuance to listing, in one place,” Fusang CEO, Henry Chong said.
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“Global investors can now benefit from access to an investment previously reserved for only the largest institutions, together with low and transparent fees.”
Regulated in Malaysia
According to the official press release, the bond will be issued by the Labuan-regulated Malaysian branch of the Chinese lender and can be traded on the digital asset exchange from Friday against the US dollar and Bitcoin.
Fusang is also licensed by Labuan as a securities exchange.
“CCB Labuan is happy to play its role as lead arranger for the first publicly listed debt security on a blockchain,” CCB Labuan’s principal officer, Felix Feng Qi stated. “CCB Labuan will continue to work on expanding the technological boundaries to provide value-added products and services to our customers, clients, and associates.”
If the Longbonds manage to gather public interest in such investment instruments, Fusang has plans to further extend its partnership with the Chinese lender on issuance in other currencies, including yuan.