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The ongoing effort to develop applications for blockchain technology in the traditional financial industry has taken another step with a successful test debt issuance carried out by Toronto-based BMO Capital Markets and Ontario Teachers’ Pension Plan.

BMO successfully executed a fixed income issuance transaction with Teachers, that was mirrored on a blockchain platform, the company announced Wednesday.

The transaction represents, “the first Canadian dollar fixed income issuance demonstrating the viability of blockchain platforms,” BMO says in a news release.

The transaction, which saw BMO issue $250 million one-year floating rate deposit note to Teachers, was booked as a traditional issuance with the Canadian Depository for Securities and paralleled on a blockchain issuance system built by BMO Capital to test a blockchain-based settlement system.

The issuance platform allows the issuer and the buyer to view the transaction on the blockchain, BMO says, and will allow them to verify the term sheet information and payment amounts until maturity.

“The technology is intended to enable cost reduction in several areas including compliance, financial reporting, security clearing and settlement of cash transactions,” BMO says, and the company will continue working with clients and other institutions to develop a blockchain-based settlement system.

“This is an important first step in developing a fully functional blockchain capability that we think will eventually allow primary and secondary trading of securities,” says Kelsey Gunderson, head of global trading at BMO Capital Markets. “We understand the potential that blockchain brings to the capital markets and we look forward to continuing to drive innovative solutions to help our clients.”