Siemens issues €60M digital bond on a public blockchain

German engineering and technology giant Siemens has become one of the first companies in Germany to issue a 60 million euro digital bond on a public blockchain with a one-year maturity under the German Electronic Securities Act.

According to announcementthe bond was sold directly to investors such as DekaBank, DZ Bank and Union Investment without the need for centralized clearing and paper global certificates. Siemens noted that this process allows transactions to be completed much faster and more efficiently than traditional bond issuance methods.

In its announcement, Siemens highlighted the benefits of using digital bonds over traditional bond issuance methods. According to the company, “blockchain bond issuance offers a number of advantages over previous processes. For example, it makes paper global certificates and central clearing unnecessary. Moreover, the bonds can be sold directly to investors, without the participation of the bank as an intermediary.”

Although the transaction was completed using classic payment methods, since the digital euro was not yet available at the time of the transaction, it was still completed in just two days. Siemens aims to position itself as a pioneer in the continuous development of digital solutions for the capital and securities markets.

Peter Rathgeb, Corporate Treasurer of Siemens AG, shared:

“By moving away from paper to public blockchains for issuing securities, we can complete transactions much faster and more efficiently than with bond issuance in the past. Thanks to our successful collaboration with our project partners, we have reached an important milestone in the development of digital securities in Germany.”

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For the past few years, Siemens has been experimenting with blockchain technology. In October 2020, Cryptooshala reported that Pebbles, a blockchain-based energy trading platform backed by German tech giant Siemens, held a virtual demo of its blockchain-based trading platform for streamlined electricity trading.

In addition, in July 2019, Siemens was considering using Blockchain technology for a car sharing program through Siemens Mobility, one of Siemens’ subsidiaries.

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