As per a report from Oct. 19, the Israel Ministry of Finance has partnered with VMware and Fireblocks to perform a proof of concept for issuing government bonds through blockchain to reduce costs and shorten the duration of issuance and clearing of government bonds.
In addition, the project aims to expand transparency, streamline processes and mitigate risks.
The new project is named “Eden” by the government. As revealed, the account general established the project through the Debt Unit in the financing division and the Tel Aviv Stock Exchange.
Worth noting, the Proof of Concept project will incorporate the digitization of a new series of bonds and its disbursement to the system participants. Before the bonds can be issued, leading international and local banks must participate in a “live test.”
In the course of the test, each bank will receive a series of tokenized government bonds on their wallet via the project platform. Afterward, the banks are expected to transfer the digital currency received to an Israeli government wallet address.
Tel Aviv stock exchange (TASE) CEO Ittai Ben-Zeev said:
“The financial markets are undergoing drastic transformations in recent years, with the introduction of revolutionary technologies that affect the manner in which customers worldwide operate and invest,”
Further, in response to the development, the Israeli Accountant General affirms that the country is currently leading, along with TASE, in issuing state bonds using blockchain technologies. With this, Israel will be able to explore new possibilities for government debt issuance and management in a secure and controlled environment.
Fireblocks CEO Michael Shaulov expressed his delight in working with the Israel Ministry of Finance, TASE, and VMware, noting that digitizing the financial system requires public and private cooperation.