Palau Unveils Blockchain-Based Savings Bonds to Fund Infrastructure Projects
The government of Palau has unveiled Palau Invest, a prototype system designed for blockchain-based savings bonds, accompanied by a public demonstration.
This project aims to generate funding for critical infrastructure initiatives within the country, supported by Japan’s Ministry of Economy, Trade and Industry and the blockchain developer Soramitsu.
Before launching the bonds, Palau’s Finance Ministry needs to establish issuance criteria and secure governmental approval. The bonds will be accessible to the nation’s 18,000 residents through a mobile application. President Surangel Whipps Jr. highlighted that this initiative will help finance essential projects, including housing, small business development, and road improvements, while also stimulating the local economy.
Initially announced in July, the full launch of the bond system is anticipated for 2025. This Pacific island nation, which uses the U.S. dollar, previously lacked a bond issuance framework.
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Operating on the Hyperledger Iroha 2 blockchain within the Sora v3 Hub Chain platform, the bonds will benefit from Soramitsu’s ongoing technical support. Soramitsu is also involved in several other projects, including Cambodia’s Bakong currency and central bank digital currency concepts in Laos and the Solomon Islands.
Palau has been working with Ripple since 2021 to develop a stablecoin pegged to the U.S. dollar, successfully progressing through initial phases of the project. Furthermore, the nation launched the Root Name System (RNS) in early 2022, which provides blockchain-based digital identification for its residency program and operates on the BNB Chain.