UBS AG unveils publicly traded digital bond that settles on blockchain

Quick Take

  • UBS AG is the first financial institution to list a digital bond that is publicly traded and settled on both blockchain-based and traditional exchanges. 
  • Investors can access the digital bond in traditional and digital markets.

Investment bank UBS AG has introduced its new digital bond, which the bank says is the first-ever to be publicly traded and settled on both blockchain-based and traditional exchanges 

The digital bond has the same investment structure, legal status and rating as a traditional senior unsecured note, the bank said in a press release. 

“We are proud to leverage distributed ledger technology to launch the inaugural UBS digital bond,” UBS Group Treasurer Beatriz Martin said in a statement. “This shows our commitment to support the development of new financial market infrastructure.”

UBS AG’s senior unsecured digital bond is a 375 million Swiss franc-denominated ($272 million) three-year bond with 2.33% coupon. The bank will list the digital bond at SDX Trading and SIX Swiss Exchange. It will be eligible for the Swiss Bond Index, along with other UBS AG senior unsecured notes. 

The digital bond settles instantly and automatically through atomic settlement technology, using the SIX Digital Exchange distributed ledger-based central securities depository network. Settlement does not require a central clearing counterparty, the bank said. 

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