There has been increase in blockchain technology applications also known as the decentralized ledger technology in private organizations and governments since it has been seen to be more secured, efficient, cheap, transparent and time conserving.
In the bid to raise €1.15 billion federal bond auction, Austria has resolved to use the ethereum blockchain which is an open sourced blockchain Network where decentralized applications could be developed.
The Austria government wants to carry out the process on Oct 2, 2018 using blockchain notarization. This shows Austria’s government resolve to be a major player in blockchain technology in Europe, and in the use of the technology in issuing sovereign bonds Austria’s Finance Ministry website stated.
This Announcement was made known by Oesterreichische Kontrollbank (OeKB), which has the responsibility to oversee the auctions for issuing federal bonds and also to ensure a neutral capital market participant for the Austrian Federal Financing Agency (OeBFA).
According to Kleine Zeitung, the OeKB IT department was in charge of developing the application for the auction notarization using the ethereum blockchain.
The two bonds that will be auctioned are German government bonds: 0.00% Federal Bond 20166-2023 and 0.75% Federal Bond 2018-2018, all worth €1.15 billion.
Responding to this development, the Finance Minister Hartwig Loger stated that:
“The digitization of the financial sector, also known as fintech, has long arrived in Austria.”
He continued by saying that:
“We need to use the positive effects intelligently for the financial services sector. Blockchain technology is an economic policy focus for us. With the establishment of the FinTech Advisory Council in the Ministry of Finance, we are developing strategies to help Austria make the best possible use of these developments.”
Contributing to this development, a member of OeKB management board, Angelika Sommer-Hemetsberger stated that:
“Blockchain technology offers great potential for increasing efficiency and ensuring the quality of bank processes, Therefore, we have been dealing with this topic intensively for some time now and have already tested several prototypes. Starting the real operation on behalf of OeBFA is a pleasing and logical next step.”
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