BOCI, the investment bank subsidiary of Bank of China, made an announcement on June 12 regarding the issuance of digital structured notes valued at 200 million Chinese yuan ($28 million) on the Ethereum blockchain. This groundbreaking step establishes BOCI as the inaugural Chinese financial institution to introduce tokenized securities in Hong Kong.
Aurelian Troendle, the Global Head of MTN Trading at UBS AG, expressed satisfaction with the collaboration with BOC International Holdings Limited (BOCI) in launching structured products on a public blockchain network. This initiative aims to cater to the rising demand from UBS’s clients in the Asia-Pacific region for regulated digital asset products.
BOCI, in a joint effort with UBS, issued fully digital structured notes worth 200 million offshore renminbi ($28 million) on the Ethereum blockchain. These notes represent a type of bond or debt obligation and were exclusively offered to Asia Pacific clients. UBS played a key role in originating the financial product, which marks a significant milestone in the collaboration between UBS and BOCI.
While developing, UBS has been simultaneously broadening its implementation of tokenization in various areas such as structured products, fixed income, and repo financing. In December 2022, the company introduced a $50 million fixed-rate note that was tokenized and digitized on a permissioned blockchain, compliant with both English and Swiss law.
UBS stated that these products are groundbreaking as they represent the first of their kind, pushing the boundaries of applicable law and blockchain technology. The issuance of the Ethereum note marks a significant milestone, as it is the first occurrence of a Chinese bank issuing a tokenized security in Hong Kong, according to UBS.