PH to issue first tokenized bonds
THE country’s first-ever offering of peso-denominated Tokenized Treasury Bonds (TTBs) will be launched on Monday with the government looking to raise a minimum of P10 billion.
The TTBs, the Bureau of Treasury said in a notice, will comprise one-year fixed-rate government securities that will pay semiannual coupons. They will be available to qualified buyers beginning November 20 with the issue date set for November 22.
The bonds can be purchased in minimum amounts of P10 million and subsequent increments of P1 million following the pattern of traditional government securities offers, the Treasury said.
These bonds will take the form of digital tokens, stored in the Bureau of the Treasury’s Distributed Ledger Technology (DLT) Registry.
A dual registry structure will be employed for the offering, running the DLT Registry alongside the National Registry of Scripless Securities with the latter acting as the main registry.
Tokenized bonds are a form of digital asset that represents ownership in a specific bond. They are issued on a blockchain, which means that they can be transferred and traded without the need for intermediaries such as banks or brokerages.
Since it is a pilot effort, Treasury Officer in Charge Sharon Almanza told The Manila Times that TTBs would not yet be tradable.
The Treasury said the TTBs would demonstrate the feasibility of using DLT in the government bond market, marking the beginning of a broader initiative to make investing more accessible through digital technology.
The goal, it continued, is to significantly decrease settlement risk and associated costs, ultimately fostering a financially inclusive local bond market.
The book-building exercise for the TTBs will commence at 9 a.m. on November 20.
Interested qualified buyers have until 12:30 p.m. to submit their bids to the issue managers, Land Bank of the Philippines and the Development Bank of the Philippines.
Notice of awards will be issued no later than 2 p.m. of the same day, the Treasury said.