Quoting from a coindesk article,
Recall that a blockchain is just a database, in this case a financial ledger containing the issued bond and some cash. So, when we talk about coupon payments, what we're actually talking about are database operations which take place automatically at an agreed time. While this automation is technically feasible, it suffers from a financial difficulty. If the funds used for coupon payments are controlled by the bond's smart contract, then those payments can indeed be guaranteed. But this also means those funds cannot be used by the bond issuer for anything else. And if those funds aren't under the control of the smart contract, then there is no way in which payment can be guaranteed. In other words, a smart bond is either pointless for the issuer, or pointless for the investor. And if you think about it, this is a completely obvious outcome
Is this objection fair? What are plausible responses? Do you all agree or disagree? What are plausible solutions? Curious to hear.