Bank of Canada, Top Banks Finish First Tokenized Bond Trial

What to Know

C$100 million ($73 million) tokenized bond was issued and settled on a distributed ledger in Canada's first trial of its kind
Project Samara brought together the Bank of Canada, RBC, TD Securities, and Export Development Canada for the experiment
The trial tested the full lifecycle of bond transactions, from bidding and coupon payments to secondary market trading
Canada is advancing stablecoin legislation and tightening digital asset custody rules alongside this blockchain push

The Bank of Canada wrapped up its inaugural tokenized bond experiment on March 6, partnering with the nation's biggest financial institutions to demonstrate how distributed ledger technology can handle the full lifecycle of a fixed-income security. The trial, dubbed Project Samara, marks a milestone in Canada's blockchain-based capital markets exploration.

How Project Samara Tested Tokenized Bonds

Export Development Canada, the federal government's export credit agency, issued a C$100 million ($73 million) tokenized bond with a maturity of under three months. The security was sold to a closed group of institutional investors.

Participants in Project Samara included RBC Dominion Securities, RBC Investor Services Trust, and the TD Securities arm of Toronto-Dominion Bank. RBC ran the underlying platform, which supported every stage of a bond transaction from initial issuance through secondary market trading.

Investors could submit bids, process coupon payments, redeem bonds, and execute secondary market trades entirely within the distributed ledger environment. The bond existed in tokenized form throughout, eliminating the need for traditional settlement intermediaries.

Digital Settlement With Wholesale Canadian Dollars

The experiment also tested digital settlement using tokenized versions of wholesale Canadian dollars. The Bank of Canada created and managed these digital funds, which moved on the same ledger as the tokenized bonds.

This design allowed transactions to settle directly within the platform, according to the central bank. By keeping both the asset and settlement currency on one distributed ledger, the trial showed how atomic settlement could reduce counterparty risk and processing times in fixed-income markets.

What Does This Mean for Canada's Crypto Regulation?

Canada is rapidly constructing a regulatory framework around digital assets alongside its blockchain experiments. In its November budget, the federal government signaled plans to introduce legislation governing Canadian-dollar-backed stablecoins, with oversight expected to involve the Bank of Canada and rules on reserve backing, redemption policies, and risk management.

Last month, the Canadian Investment Regulatory Organization (CIRO) introduced a digital asset custody framework designed to strengthen how crypto assets are held by trading platforms. The standards target risks including hacking, fraud, and insolvency following high-profile industry failures.