Another European first would generate further positive publicity for Luxembourg, just as the purchase of bitcoins did. A world first would provide an even more powerful selling point for its financial centre. However, everything will depend on what the Treasury means by the word ‘benchmark’.
On Wednesday 16 September, at Elvinger Hoss Prussen’s annual conference on fintech and the future of finance, 
The technology must enable bonds to be issued, registered and transferred on a distributed ledger. It does not alter the nature of the loan: the government still raises funds from investors and pays them interest. It changes the infrastructure on which the security is created, held, traded and, where applicable, settled.
Other initiatives
The real breakthrough announced by Gilles Roth lies in the designation as a ‘benchmark sovereign bond’. The Treasury would, therefore, no longer be preparing a trial involving a few tens of millions of euros, but a bond intended to function as a standard government issue on the markets.
This clarification is essential, as Luxembourg will not be the first European country to issue public debt on DLT. Slovenia had already done so on 25 July 2024. It had issued a digital sovereign bond worth €30m, carrying a coupon of 3.65% and redeemable four months later, on 25 November.
The security had been registered on Neobonds, BNP Paribas’s tokenisation platform. Settlement was carried out using the Banque de France’s tokenised central bank money solution, as part of the trials conducted by the Eurosystem. The Slovenian government and BNP Paribas had presented the transaction as the first digital sovereign bond issue in the eurozone and the Emea region.
This was not a simulation. The securities had actually been issued and placed with investors. However, their value of €30m and their four-month maturity meant the operation was more akin to a pilot scheme. It was not intended to become a liquid benchmark on the Slovenian yield curve.
A race against time with London and its Digit
Luxembourg itself has already gained some initial experience. In June 2025, the Treasury issued €50m worth of treasury bills entirely via a DLT infrastructure. The government thus tested the technology using real securities and real investors. However, the transaction involved short-term debt and a limited amount. It did not constitute a benchmark bond.
The European Investment Bank (EIB), for its part, has been issuing digital bonds since 2021. Several of its issues have reached €100m, with longer maturities than the Slovenian and Luxembourg pilot schemes. However, the EIB is an institution of the European Union, not a state. Its securities are therefore not national sovereign bonds.
The UK is also preparing Digit, its first native digital government bond. The UK Treasury plans to issue it no later than the first quarter of 2027 on HSBC’s Orion platform, as part of the ‘Digital Securities Sandbox’. London, however, is still referring to it as a pilot issue. According to their respective timetables, Luxembourg and the UK could find themselves competing to claim the title of ‘first’.
The strongest global precedent comes from Hong Kong. The government of the Special Administrative Region carried out its first tokenised green bond issue worth HKD800m in 2023. It then raised the equivalent of HKD6bn in 2024.
A third issuance raised approximately HKD10bn in November 2025. Spread across four currencies, it attracted more than HKD130bn in orders. The maturities ranged up to five years. The local authorities described it as the largest digital bond issue ever undertaken.
Hong Kong demonstrates that DLT can accommodate amounts and maturities that far exceed those of the initial European trials. However, its example leaves room for Luxembourg to claim a world first. Hong Kong is a special administrative region of China, not a sovereign state. Its record-breaking issue was also divided into several tranches and denominated in several currencies, rather than being concentrated in a single benchmark sovereign bond.
Other countries have explored this avenue without yet meeting all the necessary conditions. Israel has trialled a digital government bond as part of the Eden project. The Bank of Greece has simulated a sovereign bond issue on DLT. The World Bank and other multilateral institutions have issued digital bonds, but they are not sovereign states.
Hundreds of millions of euros for the benchmark
The ambition set out by Gilles Roth could, therefore, be surpassed. If Luxembourg were to issue a digital-native sovereign bond that genuinely possessed the characteristics of a benchmark, it could claim not only a European first, but also a world first.
This conclusion remains conditional. ‘Benchmark’ is not a legal designation associated with a universal minimum amount. In the euro-denominated sovereign bond market, the term refers to an issue that is large enough and widely distributed enough to be traded regularly and to serve as a benchmark for investors.
An issue worth several hundred million euros would probably be the primary criterion, although this alone would not be sufficient. The security would also need to have a maturity of several years, fit within the Luxembourg yield curve and be placed with a sufficiently large number of institutional investors. A transaction held by just a few selected participants would remain a pilot scheme, regardless of the technology used.
Liquidity will be the other test. Following the issue, investors must be able to buy and sell the security under conditions similar to those of a traditional sovereign bond. Access to pricing, the custody of the securities, their potential use as collateral, and the integration between the DLT infrastructure and existing financial systems will determine whether the market can truly adopt the bond.
The minister recognises this demonstration aspect. In his speech, he explained that the state must use these technologies to gain practical experience and demonstrate its confidence in the rules it has itself created. The initiative would thus provide banks, funds, custodians, market infrastructures and technology firms in the financial centre with a benchmark to present to international clients.
