Breaking new ground: IDB’s digital bond issuance and the future of debt capital markets
The Inter-American Development Bank (IDB) recently marked a significant milestone with the issuance of its first native security token in pound sterling – a 15-month, GBP 5 million fixed-rate bond structured under Luxembourg law. The issuance was carried out via HSBC’s Orion platform and registered on the Securities Official List of the Luxembourg Stock Exchange (LuxSE SOL) on 18 March.
Following this landmark transaction, we spoke with Ramon Ruiz Garcia, Treasurer at IDB and Arnaud Delestienne, Director of International Capital Markets and Member of the Executive Committee at LuxSE, to explore the role of distributed ledger technology (DLT) in shaping the future of capital markets, and to hear more about what’s next for IDB and LuxSE in this fast-evolving space.What role do you see blockchain and asset tokenisation playing in the modernisation of global debt capital markets?
Ramon Ruiz Garcia: Blockchain and asset tokenisation have the potential to transform global debt capital markets by enabling 24/7 trading, expanding access, reducing risk and streamlining operations. DLT could disrupt traditional processes by automating certain roles and processes, ultimately reducing costs and accelerating transactions.
These changes will require updates of legal processes and documentation to accommodate digital assets, as well as internal process adaptations to manage decentralised workflows. Key questions remain: Who will assume ownership and accountability of these ledgers? Will standardisation be achieved to enable interconnectivity among them? Will central banks implement Central Bank Digital Currency (CBDCs) to facilitate these developments?
Arnaud Delestienne: Ramon makes very valid points. Despite being in its early stages, and with a lot of questions still to be answered, DLT is already showing strong potential as a catalyst for the digital transformation of financial services. Europe has taken a leading role on this front, driven by the European Commission’s Digital Finance Strategy and a strong regulatory foundation that includes MiCA, DORA and the DLT Pilot Regime. These initiatives are laying the groundwork for a more modern, secure and resilient market infrastructure, and we’re now beginning to see the first concrete outcomes.
Narrowing down the scope to securities services, and more particularly to the primary debt market, DLT has the potential to reduce the time, risk, cost, and overall complexity associated with the issuance process, enabling a quicker and augmented interaction between issuers and investors. This could bring significant benefits in terms of data standardisation, information dissemination, transparency and operational efficiency, which today are more important than ever.
The secondary market also stands to benefit from growing adoption of this technology. Instant settlement capabilities, continuous operations, and the potential to fractionalise assets can take risks out of the equation, enhance market liquidity and broaden investor participation. Ultimately, the evolution of DLT represents a glimpse into the future of capital markets, and it’s exciting to see how this technology can be leveraged to increase efficiency, transparency, and accessibility across the board.Could you share more about the IDB Group’s involvement in digital finance?
Ramon Ruiz Garcia: At IDB we are looking to harness technology to streamline our operations and increase efficiency across debt capital market activities, so we can revert these gains to support development projects in our member countries. In 2022, the IDB issued a bond using DLT, settled through Iberclear, the Spanish clearinghouse. In 2025, the IDB issued another bond via HSBC’s Orion platform, reinforcing its strategy to adopt cutting-edge financial solutions.
IDB and IDB Invest have also participated in a proof of concept (PoC) for a bond issued in Colombia in Colombian pesos, acting as investors in the security. In addition, IDBLab, the Innovation Laboratory of the IDB, leads LACChain, a global alliance of stakeholders working to advance the blockchain ecosystem in Latin America and the Caribbean. Its objective is to accelerate the adoption of blockchain technology in the region to foster innovation, reduce economic, social, gender and all inequalities; enhance job quality and security, promote financial inclusion, strengthen consumer protection and market integrity.
In short, for us, digital finance is an important enabler to improve how development is delivered. We remain committed to staying at the forefront of technological innovation to build more efficient and resilient financial systems in the region.
In October 2023, we reached an important milestone by becoming the first exchange in the European Union to admit a native security token to trading, on our regulated market. This pioneering listing reaffirmed our long-standing commitment to the digitalisation of capital markets.
To date, we have supported the listing of 11 security tokens, including several that have since matured. We currently display seven active tokens, three of which are also featured on our Luxembourg Green Exchange, highlighting the intersection of innovation and sustainability.
At LuxSE, we are keen to support the development of an open and inclusive ecosystem for tokenised securities, and welcome issuances across both our regulated and Euro MTF markets. Our aim is to promote interoperability across the capital markets value chain, which is undoubtedly a critical factor for long-term scalability and adoption. By enabling our trading members to make use of their standard connectivity channels, we make it easier for market participants to invest in and trade these digital securities, allowing secondary market liquidity to develop and avoiding further market fragmentation.
Looking beyond our role as a listing venue, we strive to provide issuers like IDB with an infrastructure that enhances visibility, accessibility, and operational efficiency. The work of the IDB Lab to foster inclusive innovation across Latin America and the Caribbean is truly inspiring, and we are proud to support this momentum by offering a flexible and future-proof platform aligned with their digital ambitions.
What are the next steps for the IDB in terms of digital bond issuance?
Ramon Ruiz Garcia: At the IDB, we are actively monitoring distributed ledger technology (DLT) in debt capital markets. While our two DLT-based bond issuances to date have been standalone initiatives, we remain closely engaged with the market and prepared to adopt this technology more broadly as DLT settlements gain traction and drive greater operational efficiency.
We plan to scale up volumes once the market reaches a more mature stage. In the meantime, we will continue participating in small transactions to stay informed and ensure we are ready for the transformation that is expected to reshape the industry in the near future.
For more information, please visit the bond's security card:
https://www.luxse.com/security/US45828RAC97/424895
Following this landmark transaction, we spoke with Ramon Ruiz Garcia, Treasurer at IDB and Arnaud Delestienne, Director of International Capital Markets and Member of the Executive Committee at LuxSE, to explore the role of distributed ledger technology (DLT) in shaping the future of capital markets, and to hear more about what’s next for IDB and LuxSE in this fast-evolving space.
What role do you see blockchain and asset tokenisation playing in the modernisation of global debt capital markets?
How might the evolution of DLT impact market dynamics and processes?
Ramon Ruiz Garcia: Blockchain and asset tokenisation have the potential to transform global debt capital markets by enabling 24/7 trading, expanding access, reducing risk and streamlining operations. DLT could disrupt traditional processes by automating certain roles and processes, ultimately reducing costs and accelerating transactions.
These changes will require updates of legal processes and documentation to accommodate digital assets, as well as internal process adaptations to manage decentralised workflows. Key questions remain: Who will assume ownership and accountability of these ledgers? Will standardisation be achieved to enable interconnectivity among them? Will central banks implement Central Bank Digital Currency (CBDCs) to facilitate these developments?
Arnaud Delestienne: Ramon makes very valid points. Despite being in its early stages, and with a lot of questions still to be answered, DLT is already showing strong potential as a catalyst for the digital transformation of financial services. Europe has taken a leading role on this front, driven by the European Commission’s Digital Finance Strategy and a strong regulatory foundation that includes MiCA, DORA and the DLT Pilot Regime. These initiatives are laying the groundwork for a more modern, secure and resilient market infrastructure, and we’re now beginning to see the first concrete outcomes.
Narrowing down the scope to securities services, and more particularly to the primary debt market, DLT has the potential to reduce the time, risk, cost, and overall complexity associated with the issuance process, enabling a quicker and augmented interaction between issuers and investors. This could bring significant benefits in terms of data standardisation, information dissemination, transparency and operational efficiency, which today are more important than ever.
The secondary market also stands to benefit from growing adoption of this technology. Instant settlement capabilities, continuous operations, and the potential to fractionalise assets can take risks out of the equation, enhance market liquidity and broaden investor participation. Ultimately, the evolution of DLT represents a glimpse into the future of capital markets, and it’s exciting to see how this technology can be leveraged to increase efficiency, transparency, and accessibility across the board.
Could you share more about the IDB Group’s involvement in digital finance?
How does it support technological innovation across the Latin American and Caribbean region?
Ramon Ruiz Garcia: At IDB we are looking to harness technology to streamline our operations and increase efficiency across debt capital market activities, so we can revert these gains to support development projects in our member countries. In 2022, the IDB issued a bond using DLT, settled through Iberclear, the Spanish clearinghouse. In 2025, the IDB issued another bond via HSBC’s Orion platform, reinforcing its strategy to adopt cutting-edge financial solutions.
IDB and IDB Invest have also participated in a proof of concept (PoC) for a bond issued in Colombia in Colombian pesos, acting as investors in the security. In addition, IDBLab, the Innovation Laboratory of the IDB, leads LACChain, a global alliance of stakeholders working to advance the blockchain ecosystem in Latin America and the Caribbean. Its objective is to accelerate the adoption of blockchain technology in the region to foster innovation, reduce economic, social, gender and all inequalities; enhance job quality and security, promote financial inclusion, strengthen consumer protection and market integrity.
In short, for us, digital finance is an important enabler to improve how development is delivered. We remain committed to staying at the forefront of technological innovation to build more efficient and resilient financial systems in the region.
How does LuxSE facilitate these technical advancements, and in what ways has it supported this important pilot initiative by the IDB?
Arnaud Delestienne: LuxSE has been among the early movers and has actively supported the development of DLT-based instruments for some time – specifically since the start of 2022, when we registered the first financial instruments issued using distributed ledger on our securities official list, LuxSE SOL.In October 2023, we reached an important milestone by becoming the first exchange in the European Union to admit a native security token to trading, on our regulated market. This pioneering listing reaffirmed our long-standing commitment to the digitalisation of capital markets.
To date, we have supported the listing of 11 security tokens, including several that have since matured. We currently display seven active tokens, three of which are also featured on our Luxembourg Green Exchange, highlighting the intersection of innovation and sustainability.
At LuxSE, we are keen to support the development of an open and inclusive ecosystem for tokenised securities, and welcome issuances across both our regulated and Euro MTF markets. Our aim is to promote interoperability across the capital markets value chain, which is undoubtedly a critical factor for long-term scalability and adoption. By enabling our trading members to make use of their standard connectivity channels, we make it easier for market participants to invest in and trade these digital securities, allowing secondary market liquidity to develop and avoiding further market fragmentation.
Looking beyond our role as a listing venue, we strive to provide issuers like IDB with an infrastructure that enhances visibility, accessibility, and operational efficiency. The work of the IDB Lab to foster inclusive innovation across Latin America and the Caribbean is truly inspiring, and we are proud to support this momentum by offering a flexible and future-proof platform aligned with their digital ambitions.
What are the next steps for the IDB in terms of digital bond issuance?
Do you plan to scale up issuance volumes in this format?
Ramon Ruiz Garcia: At the IDB, we are actively monitoring distributed ledger technology (DLT) in debt capital markets. While our two DLT-based bond issuances to date have been standalone initiatives, we remain closely engaged with the market and prepared to adopt this technology more broadly as DLT settlements gain traction and drive greater operational efficiency.
We plan to scale up volumes once the market reaches a more mature stage. In the meantime, we will continue participating in small transactions to stay informed and ensure we are ready for the transformation that is expected to reshape the industry in the near future.
For more information, please visit the bond's security card:
https://www.luxse.com/security/US45828RAC97/424895
