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(Bloomberg) -- A BlackRock Inc. fund has bought municipal debt issued earlier this year in a first-of-its-kind deal that relies exclusively on blockchain technology.

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BlackRock purchased the bonds through an actively-managed exchange-traded fund called the iShares Short Maturity Municipal Bond Active ETF or MEAR, according to a spokesperson for the firm. The fund was founded in 2015 and has roughly $750 million in client assets.

The securities were issued by the city of Quincy, Massachusetts, in April and underwriter JPMorgan Chase & Co. used an application on its private, permissioned blockchain-based platform to facilitate the sale. It was first deal where muni debt was purchased, settled and held all in blockchain on the platform.

BlackRock is the first investor to purchase a portion of the deal, the company said. The ETF lists holdings including a total position of $6.5 million in the Quincy deal, according to data compiled by Bloomberg.

“The use of blockchain throughout the lifecycle of bonds is just one example of the potential for this technology to transform capital markets,” said Pat Haskell, head of the municipal bond group at BlackRock. “This transaction marks a significant moment for the municipal bond market and is a testament to BlackRock’s dedication to innovation.”

The prospectus for MEAR was updated to allow the fund to invest in muni bonds settled on JPMorgan’s application Digital Debt Service, according to US Securities and Exchange Commission filing dated Dec. 17. Risks disclosed to investors include lack of liquidity and the potential for errors, bugs or limitations in the application’s underlying computer code.

A handful of issuers and underwriters have been testing the muni market’s appetite for using blockchain technology in recent years. The Michigan State University board of trustees also considered a deal that would have been registered on a proprietary digital assets platform provided by Goldman Sachs.

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