The Austrian government decided to use the blockchain technology to fasten and facilitate the issuance of government bonds. Their choice fell on the Ethereum platform.

Government bonds go into the chain

On 2 October, the Treasury of Austria (OeBFA) will hold an auction, during which it plans to sell government bonds issued via blockchain and worth €1.15 billion. One of the largest Austrian banks Oesterreichische Kontrollbank (OeKB) will operate the auction.

“For us, blockchain technology forms a focus of economic policy. Through setting up the FinTech Advisory Council at the Ministry of Finance, we are developing strategies enabling Austria to benefit optimally from these developments,” said Austrian Finance Minister Hartwig Löger.

The system was developed by the IT department of the Treasury of Austria. All deals will be notarized as hash values on the public blockchain of Ethereum.

“Following successful tests, a Blockchain notarization service will be used for the first time at the next week’s Federal Bond Auction,” the Kontrollbank said in a statement.

Young politicians bets on blockchain

Recently, a conservative party led by one of Europe's youngest leaders, 32-year-old Austrian chancellor Sebastian Kurtz, came to power in Austria. The rhetoric of the Austrian authorities sharply became warmer to the fintech market and in particular the blockchain technology.

"Blockchain and similar solutions will be used in many areas of the digital economy and public administration as a basic technology," the Austrian Ministry of Finance said in a statement.