Is Bitcoin a safe bet?
Who would have thought to read this just a few years ago, when the whole economic and financial system was laughing at cryptomoney? And yet, it’s true. The China Construction Bank is going to raise funds. And behave yourself! In addition to the US dollar, it will gladly accept Bitcoins (BTC).
A digital bank bond issue
According to an article in the South China Morning Post newspaper, the major bank Bitcoin Profit app will launch a sale of a total of $3 billion worth of blockbuster bonds.
The Chinese banking giant has teamed up with Hong Kong-based fintech Fusang. The latter will enable the distribution of this digital title on its eponymous crypto stock exchange.
These “blockchained” bonds allow a certain democratization of the public of investors who can access them. The fact of listing these digitized bonds via blockchain makes it possible to issue them at lower costs, by reducing intermediaries and their commissions.
Thus, equivalents in traditional form would be sold for several tens of thousands of yuan each (more than 1,500 dollars), which means that they are more likely to be sold to professional or well-to-do investors. In this case, the China Construction Bank warrants can be subscribed for a minimum of only 100 dollars each.
“If this sale is a success with investors, Fusang hopes to work with the state-owned bank on the issue in other currencies, including the yuan. “Henry Chong, CEO of Fusang.
When Bitcoins become ingrained
The other incredible feature that makes this bond sale unique is that the China Construction Bank will accept both classic US dollars and Bitcoin.
The bonds will be freely tradable on the Fusang Exchange, authorized by the financial regulator in Labuan, Malaysia.
“We believe this will be the beginning of cryptos 2.0: the true institutionalization of digital assets. “Henry Chong
These digital bonds will be open for trading on Friday, November 13. A first tranche of $58 million of bonds will be issued, aimed at both retail and institutional investors.
Since this is traditional finance (not DeFi), however, an exceptional interest rate was not to be expected. It will only be 0.75%, which is still three times the current standard interbank rate (Libor) for this type of bond (which is only 0.25%).
This says a lot about the value that even major banks now place on Bitcoin. The king of cryptos has established itself here as a store of value as reliable as the US dollar. Bitcoin seems more and more destined for a great destiny.