NRW.BANK, a prominent German state-owned development bank, has recently made a groundbreaking move by issuing a €100 million ($116.7 million) blockchain-based bond on the Polygon network. This significant step marks a major advancement in the public sector’s adoption of digital securities.
The two-year maturity bond was issued under Germany’s Electronic Securities Act (eWpG), which allows for the issuance and registration of bonds entirely on blockchain networks, eliminating the need for physical certificates.
To facilitate the registration of the bond, NRW.BANK utilized the services of Cashlink Technologies, a BaFin-licensed crypto securities registrar, with the Polygon network serving as the underlying blockchain infrastructure. Institutional investors such as Deutsche Bank, DZ BANK, and DekaBank participated in the offering as joint lead managers.
Michael Duttlinger, CEO of Cashlink, emphasized the significance of this milestone, stating, “This is more than a technical milestone. It’s a signal that public financial institutions are ready to move beyond blockchain pilots and start integrating these systems at scale.”
This issuance represents NRW.BANK’s first fully digital issuance of this kind, underscoring the growing confidence in blockchain technology for regulated capital markets. The eWpG law, introduced in 2021, has provided a legal framework for the use of distributed ledger technology in securities, attracting banks and public institutions to embrace tokenized finance.
In parallel with the bond issuance, Polygon is gearing up for a major technical upgrade with the deployment of Heimdall 2.0, a new consensus layer for its proof-of-stake blockchain. Scheduled to go live soon, the upgrade aims to reduce finality time to just five seconds and enhance network resilience by minimizing chain reorganizations.
The convergence of the bond issuance and the Polygon upgrade signals the maturation of blockchain infrastructure supporting tokenized finance. Digital bonds offer numerous advantages, including real-time tracking, faster settlement, and reduced administrative overhead, making them increasingly attractive to public-sector issuers.
Germany is emerging as a hub for regulated blockchain finance, with major institutions like DZ BANK, DekaBank, Commerzbank, KfW, and Siemens issuing digital bonds. The country’s traditional banking sector is also embracing crypto, with Sparkassen-Finanzgruppe set to introduce crypto trading services to its customers by mid-2026.
Furthermore, Polygon continues to evolve strategically under the leadership of Sandeep Nailwal, who now serves as CEO of the Polygon Foundation. Despite market fluctuations, Polygon remains a key player in tokenization, ranking 6th in total RWA value and capturing a significant portion of the tokenized bond market.
In conclusion, NRW.BANK’s issuance of a €100 million bond on Polygon signifies a pivotal moment in the convergence of traditional finance and crypto. As Germany advances its digital bond push and embraces blockchain technology, the landscape of financial markets is undergoing a transformative shift towards a more digitized and efficient future.