Canada has completed a pilot testing distributed ledger technology (DLT) in bond markets, culminating in the nation’s first tokenized bond, the Bank of Canada announced Friday. Project Samara brought together the Bank of Canada, Export Development Canada (EDC), Royal Bank of Canada and TD Bank Group to examine whether blockchain-style infrastructure can streamline issuance, trading and settlement of debt securities.
Under the pilot, EDC issued a CA$100 million (about US$73.6 million) bond with a maturity under three months to a closed group of investors. The security was issued, traded and settled on a DLT platform and used wholesale central bank deposits for payments instead of commercial bank money. The platform, built on Hyperledger Fabric, supported the full lifecycle of the bond — issuance, bidding, coupon payments, redemption and secondary trading — and integrated separate ledgers for cash and bonds to enable near-instant settlement.
Participants reported operational improvements and stronger data integrity but also noted trade-offs. The experiment highlighted potential benefits such as faster settlement and reduced counterparty risk, while identifying challenges including governance, regulatory alignment and integration with existing infrastructure that could slow broader adoption.
Project Samara adds to a growing wave of government and bank experiments with tokenized bonds. In 2018 the World Bank issued a two-year A$110 million “Bond-i,” often cited as the first bond recorded on a blockchain. In 2022 the Monetary Authority of Singapore launched Project Guardian to study DLT use in wholesale markets, including pilots exploring decentralized finance-style lending and tokenized bonds on public chains. Hong Kong issued a tokenized green bond in 2023 with the Hong Kong Monetary Authority’s support and expanded digital bond programs in subsequent years. In 2024 the World Bank issued a Swiss franc digital bond on the SIX Digital Exchange with settlement using wholesale central bank digital currency provided by the Swiss National Bank.
While cases like Project Samara demonstrate the technical feasibility and potential market efficiencies of tokenized securities, participants and observers emphasize that legal, regulatory and operational frameworks must evolve to realize widespread adoption. Cointelegraph is committed to independent, transparent journalism; readers are encouraged to verify information independently.
