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European Investment Bank’s Blockchain Bond Pushes ETH to New Highs

eib eth

European Investment Bank (EIB), the publicly owned lending arm of the European Union, sold a 100M euro bonds registered on the Ethereum blockchain.

This marks the EIB’s first blockchain bond sale. 

The 2-year digital bonds will be registered in the Ethereum blockchain after pricing on Tuesday, and will have a zero percent coupon, as reported by Bloomberg, citing an unnamed source. The sale will be joint-managed by Goldman Sachs International, Société Générale, and Santander.

ETH All-Time High

ETH jumped after the news was reported and continued to climb to a new record of over $2,700 today. The news signals that institutions consider the Ethereum blockchain to be a viable settlement layer for financial instruments and activity. 

As further evidence of institutional interest, JP Morgan today echoed a March Bank of America report, saying, “ETH is the backbone of the crypto-native economy. To the extent owning a share of this potential activity is more valuable…ETH should outperform BTC over the long run.” 

Regulatory Risk

The European Union’s lending arm using Ethereum as a financial settlement layer is a sign that banks are becoming more comfortable with the regulatory risk of using blockchain technology. 

“If they’re on board with Ethereum and not going to try and regulate it away, it bodes well not just for Europe but the whole planet,” DeFi community member Forager told The Defiant.

Société Générale and Santander both previously launched blockchain bonds on Ethereum in 2019. Société Générale issued a €100M covered bond to itself as a security token on Ethereum. Santander issued a $20M bond directly onto the public Ethereum blockchain, which was purchased by one of the group’s units at market price.

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