Austria will raise 1.15 billion euros in a federal bond auction on 2 October using blockchain notarization, according to Oesterreichische Kontrollbank (OeKB), which controls auctions for issuing federal bonds as Neutral capital participant for the Austrian Federal Finance Agency (OeBFA). The auction demonstrates the pioneering role of Austria in Europe for the implementation of blockchain technology for issues of government bonds, as reported on the website of the Ministry of Finance.
Two German government bonds outstanding, 0.75% of federal bonds 2018 – 2018 and 0.00% of federal bonds 20166 – 2023, for € 1.15 billion, will be put up for auction.
The IT department of OeKB implemented the project using the Ethereum blockchain, according to Kleine Zeitung.
The digitization of finances arrives
"The digitization of the financial sector, also known as fintech, has long since come to Austria," said Finance Minister Hartwig Loger in a prepared statement. "We need to use the positive effects in an intelligent way for the financial services industry: blockchain technology is an economic policy objective for us: with the establishment of the FinTech advisory board at the Ministry of Finance, we are developing strategies to help Austria make the best use of these developments ".
"Blockchain technology offers great potential to increase efficiency and ensure the quality of banking processes," said Angelika Sommer-Hemetsberger, a member of the OeKB board, in a prepared statement. "Therefore, we have been tackling this subject intensively for some time and have already tested several prototypes and starting the real operation on behalf of OeBFA is a welcome and logical next step."
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Notarization to verify the data
The blockchain notarization service will verify the authenticity of the data. "This increased security contributes to a high level of confidence in the sales process of Austrian government bonds and reinforces Austria's good reputation in the market, which can also indirectly contribute to favorable financing costs," said Markus Stix, manager of OeBFA.
Blockchain and similar solutions will be used as the main technology in many aspects of public administration, OeKB noted, evaluating several blockchain technologies for the project.
Vienna image from Shutterstock.
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