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Blockchain technology moves forward and expands all over the world. This time, the Russian bank Sberbank has completed its first blockchain-enabled commercial bond transaction. The operation was carried through its Corporate and Investment banking business section (CIB), according to an announcement on May the 16th.

Sberbank Blockchain Enabled Commercial Bond Transaction

Russia’s largest state bank has been working with MTS, the biggest telecom operator in Russia and with the National Settlement Depository. The MTS corporate bonds were valued at $12 million dollars with a six-month maturity using smart contracts. 

The transaction has been performed through the Hyperledger Fabric 1.1 provided by NSD. It is important to mention that commercial bonds are income securities that are unsecured, they are issued by a company and placed on an OTC market through a private subscription.

Senior Vice President of Sberbank, Igor Bulantsev, explained:

“The MTS bond issue confirmed to us that Blockchain is very reliable, efficient and secure which can be used to carry out some complex transactions involving securities. The technology also demonstrated its potential which can help in the development of Russia’s digital economy.”

High executives from these companies are very excited about the transaction performed and the possibilities that blockchain technology unlocks for banks, enterprises and the country.

Eddie Astanin, Chairman of the Executive Board of NSD, said:

“NSD was among the very first companies to adopt Blockchain in Russia. We started working on a prototype platform to help in a bond transaction in the First Quarter of 2017. However, the deal with MTS and Sberbank was massive and shows that Blockchain technology can provide speed and confidentiality when working with securities.”

Blockchain Technology Expands in Russia

Russia is working with blockchain technology since very long. The president itself requested for the creation of a cryptocurrency known as CryptoRuble. There are different projects that involve distributed ledger technology in the Eurasian country.

We can mention the ‘Active Citizen’ platform, which allows Russian citizens from Moscow to vote for different proposals that would change the city. The platform is powered by Ethereum and is one of the biggest voting platforms based in the Ethereum network.

Moreover, Russia has open two cryptocurrency agencies in Vladivostok and a school where they teach about blockchain technology. It is clear that Russia is one of the countries that invest the most in DLT and related technologies.

Other banks all over the world are implementing Bitcoin so as to process transactions instead of SWIFT. Bitbond, a German bank and an Argentinian financial institution are processing transactions in Bitcoin to reduce costs.

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