Gov’t raises P15B from ‘tokenized’ T-bond debut
MANILA -The Philippine government raised more than it had hoped to borrow during its first ever sale of “tokenized” Treasury bonds (T-bonds), in what it hailed as a “successful” program aimed at helping reach the long-term goal of fostering a financially inclusive domestic debt market.
The government raised P15 billion during Monday’s launch of the tokenized T-bonds, bigger than the P10 billion it had originally planned, the Bureau of the Treasury (BTr) said in a statement.
What allowed the government to upsize the offering was the strong demand for the tokenized securities. Total bids for the T-bonds, which are payable in one year, amounted to P31.43 billion, more than thrice the original size of the issuance.
Tokenized bonds are exchanged digitally through a blockchain or decentralized ledger. According to the BTr, the debt securities were sold in the form of “digital tokens” that will be maintained at the bureau’s distributed ledger.
The tokenized T-bonds fetched a rate of 6.50 percent, aligning with the prevailing rates quoted for the comparable tenor at the secondary market where tokenized debt instruments cannot be traded.
While other well-known use of blockchain technology like cryptocurrencies was met with caution, the tokenization of real assets like debt and equity instruments is seen as a huge step in democratizing financial markets.
“The bond tokenization program is anchored on the national government’s long-term vision of a financially inclusive domestic capital market,” Finance Secretary Benjamin Diokno said.
“Through streamlining settlement procedures and minimizing friction costs, this initiative is a huge leap towards our end goal of democratizing investment and empowering our small investors,” he added.
The government offered its first-ever tokenized bonds to institutional investors, with the minimum investment set at P10 million, which can be increased in increments of P1 million.