A new blockchain platform has been launched making it possible to issue, buy and trade corporate bonds on the blockchain.
Bondex.io is the brainchild of Bloqbuster, a tech startup that has partnered with development firm Flashboys to build and design the Bondex blockchain initiative.
The idea behind Bondex is to provide startups with an additional avenue through which to raise capital for projects. It gives them the ability to create their own bond issuing portal on a decentralized network to attract and register investors.
Bloqbuster had been working with Flashboys on a small bond-issuing project when it became apparent to them that a much larger market exists for alternative financing methods.
The team has also partnered with Dutch blockchain-based real-estate investment firm Briqchain to handle the launch of an Initial Bond OFfering (IBO) this month. Most notably, the firm offers an exit after five years which they believe makes the product more attractive over normal equity tokens.
While rare, blockchain bonds are not an entirely new concept. In August this year, The World Bank priced the first ever blockchain bond at $73 million in a management deal with the Commonwealth Bank of Australia. The prototype was launched as a way to test the emerging technology and has been dubbed the ‘Bondi’, for Blockchain Operated New Debt Instrument.
As with Bondex.io, the ‘Bondi’ is managed through a private, Ethereum-based blockchain but is also rooted in a Microsoft Azure cloud infrastructure, raising questions about how truly decentralized it is. It’s issuance by the World Bank also tends to fly in the face of the original principles of cryptocurrency.