Societe Generale has made history by issuing the world’s first digital green bond on a public blockchain. The French financial services giant utilized the Ethereum blockchain to issue a senior preferred unsecured bond with an initial transaction of 10 million euros. The bond, which was issued as a Security Token and registered on November 30 by Societe Generale subsidiary Forge, has a maturity of three years and grants access to the transparency and traceability of its carbon footprint via a smart contract.
According to a news release from Societe Generale, the net proceeds from the bond will be used to finance or refinance eligible green projects or activities. This groundbreaking move signifies a significant step in the integration of blockchain technology into traditional financial systems and demonstrates the growing adoption of blockchain by major financial institutions.
Societe Generale is also providing investors with the option of settling securities on-chain through the EUR CoinVertible (EURCV), a euro-pegged stablecoin Forge issued in April. This alternative settlement method offers investors a digital solution to traditional cash settlement and aligns with the ongoing experimentation with Central Bank Digital Currencies (CBDCs) by various countries.
The issuance of this digital green bond on the Ethereum blockchain highlights Societe Generale’s commitment to leveraging blockchain technology and promoting sustainable finance initiatives.
Societe Generale has become the first financial institution to issue a digital green bond on the Ethereum blockchain. The senior preferred unsecured bond has an inaugural value of 10 million euros and will finance eligible green projects. This move showcases Societe Generale’s dedication to utilizing blockchain technology and supporting sustainable finance projects.
Q: What is a digital green bond?
A: A digital green bond is a bond issued and transacted using blockchain technology, and its proceeds are specifically allocated to fund environmentally friendly projects or activities.
Q: Why did Societe Generale issue the digital green bond?
A: Societe Generale issued the digital green bond to promote transparency, traceability, and sustainable finance initiatives. The move also aligns with the growing trend of integrating blockchain technology into traditional financial systems.
Q: What is the significance of issuing the bond on the Ethereum blockchain?
A: By utilizing the Ethereum blockchain for the bond issuance, Societe Generale is leveraging a public and decentralized blockchain platform known for its security and functionality, signaling the bank’s commitment to embracing advanced technology for financial innovation.