Definition ∞ A public debt security represents a financial instrument issued by a government or public entity to raise capital, typically involving a promise to repay the principal amount with interest over a specified period. While traditionally distinct from digital assets, the concept is relevant in discussions about tokenized government bonds or central bank digital currencies. These securities are a fundamental component of global financial markets. Their issuance is subject to strict regulatory frameworks.
Context ∞ The potential for tokenizing public debt securities on blockchain networks is an ongoing discussion in financial news, bridging traditional finance with digital asset innovation. This development could streamline issuance, trading, and settlement processes, offering greater transparency and efficiency. Regulatory bodies are actively exploring frameworks to accommodate such digital representations of government obligations.
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