Corporate bond issuance for capital markets
Corporate bond issuance through ATK reduces time-to-market from months to days while automating ongoing servicing. The platform handles primary distribution, coupon payments, and redemption with embedded compliance controls.
Who should read this: Corporate treasurers, investment bankers, capital markets teams evaluating faster execution and reduced operational overhead.
Business value: Cut issuance timelines by 80%, eliminate transfer agent fees, calculate quarterly coupon entitlements with on-demand claiming, and gain real-time cap table visibility.
Business challenge
MidCorp Industries needs to raise $50 million through a three-year bond offering. Traditional underwriting involves months of roadshows, weeks of settlement, and ongoing manual processes for coupon payments and investor communications.
Traditional approach
How ATK solves it
ATK's lifecycle management capabilities eliminate manual processes:
- DvP settlement for atomic primary distribution and secondary trading
- Vault custody for secure treasury management with multi-signature controls
- Scheduled yield calculations for quarterly coupon entitlements without manual spreadsheet work
Configuration and deployment
MidCorp's treasury team uses the Asset Designer to configure a bond token: $50 million principal, 5% annual coupon paid quarterly, three-year maturity, USD denomination. They select a Regulation D compliance template to limit the offering to accredited US investors.
The platform generates the smart contract with compliance controls embedded. Critically, ATK also deploys a fixed yield schedule contract that will calculate quarterly coupon entitlements for claim-based distribution and connects the bond to the XvP settlement system for atomic trading.
MidCorp uploads their offering memorandum, which gets cryptographically hashed and linked to the token metadata. Legal documentation remains permanently associated with the asset.
Investor onboarding with embedded compliance
Accredited investors connect through the Investor Portal and complete KYC verification via an integrated provider. Their OnchainID receives an accreditation claim. Only wallet addresses linked to verified, accredited identities can receive bond tokens. Non-accredited addresses cannot receive tokens; transfers revert automatically.
Primary distribution with DvP settlement
MidCorp allocates tokens to a subscriber list. Using ATK's XvP settlement system, investors exchange cash (stablecoins or tokenized deposits) for bond tokens atomically. If an investor's payment fails, they don't receive tokens. If token transfer fails (e.g., compliance violation), payment doesn't leave their wallet. Both legs execute together or both revert—true delivery versus payment.
The platform enforces that every recipient meets eligibility requirements, eliminating risk of non-compliant distribution. Settlement is instant with T+0 finality. No reconciliation required.
Scheduled coupon calculations via yield schedules
ATK's fixed yield schedule contract calculates quarterly entitlements without manual spreadsheet work. Every quarter, the yield system calculates interest owed to each holder based on proportional ownership at the snapshot block. Token holders claim their coupons directly through the smart contract with cryptographic proof of entitlement.
The platform supports claims through:
- Tokenized cash settlement – Token holders claim their distributions when stablecoins or tokenized deposits fund the yield wallet
- Off-chain payment adapters – Integration with treasury systems for traditional wire/ACH settlement (roadmap)
- Manual approval workflows – For jurisdictions requiring human review before disbursement
This eliminates the nightmare of calculating payments for hundreds of investors, generating wire instructions, and reconciling settlements. The yield schedule is configured once during issuance; entitlements are calculated automatically on payment dates, and investors claim their coupons on-demand. No spreadsheets. No transfer agent. No manual wire transfers.
Vault custody for treasury operations
MidCorp's bond proceeds are held in ATK's multi-signature vault with configurable approval requirements. Treasury operations require multiple signatures—no single person can move funds unilaterally. The vault provides:
- Maker-checker workflows where one admin proposes and others approve
- Emergency pause capabilities to freeze operations if accounts are compromised
- Full audit trails showing every proposal, approval, and execution
- Role-based access control separating operational roles
This provides bank-grade custody without requiring integration with external custodians.
Real-time cap table visibility
MidCorp's IR team sees current ownership in real time through the admin dashboard. No waiting for monthly reports from a transfer agent. When investors trade bonds on secondary markets (if permitted through ATK's XvP settlement system with atomic DvP), the cap table updates immediately.
Maturity and redemption
At three years, the platform handles redemption automatically: bond tokens are burned, principal plus final interest is distributed, and the issuance concludes with complete audit trails showing every payment, every holder, and every compliance check throughout the lifecycle.
Key capabilities
| Capability | Traditional | With ATK |
|---|---|---|
| Issuance timeline | 8-12 weeks | Days |
| Settlement | T+2 to T+5 | Instant atomic finality |
| Coupon processing | Manual calculation & wire instructions | Scheduled calculations with on-demand claiming |
| Cap table updates | Monthly from transfer agent | Real-time on-chain |
| Compliance enforcement | Post-trade surveillance | Pre-transfer validation |
| Transfer agent fees | Ongoing quarterly fees | Eliminated |
Measurable outcomes
Time savings – Illustrative deployments reduce issuance timelines from 8-12 weeks to under two weeks by eliminating roadshow logistics and settlement delays.
Cost reduction – Transfer agent fees for ongoing servicing are eliminated. Legal review time decreases because compliance templates are pre-vetted. Operations overhead drops as corporate actions execute automatically.
Secondary market liquidity – Instant settlement enables institutional investors to trade positions knowing finality arrives in minutes rather than days.
Compliance certainty – Zero non-compliant transfers because only verified accredited investors can hold tokens. Transfer restrictions are enforced at the smart contract level.
The diagram above shows the ATK bond lifecycle, from configuration through automated servicing to redemption.
Compliance considerations
Bond tokens operate under securities regulations requiring:
- Accredited investor verification – Enforced via OnchainID claims before token transfer
- Transfer restrictions – Lock-up periods, ROFR rights, and volume limits configured in compliance modules
- Jurisdiction controls – Geographic restrictions via country allow/block lists
- Audit trails – Every transaction, compliance check, and lifecycle event recorded on-chain
For detailed compliance architecture, see Compliance & Security.
Implementation checklist
- Define bond terms (principal, coupon rate, maturity, currency)
- Select compliance template (Reg D, Reg S, or custom ruleset)
- Integrate KYC/AML provider for investor verification
- Configure payment adapter for coupon distributions (tokenized cash or off-chain settlement)
- Upload offering documents and link to token metadata
- Deploy smart contract and conduct primary distribution
- Configure coupon scheduler and test distribution workflow
- Set up admin dashboard access for IR and operations teams
Next steps
- Review SMART Protocol architecture to understand embedded compliance
- Explore Developer Documentation for technical integration details
- Contact your SettleMint representative to discuss a bond tokenization pilot