On December 4th, Société Générale (SocGen), the third-largest bank in France, made a significant entry into the blockchain race by issuing the first-ever €10 million digital green bond on Ethereum. This move marks a breakthrough in blockchain-based financial solutions and signals the increasing digitization within the global financial sector.
According to SocGen, their cryptocurrency unit, SG-FORGE, issued a bond structured as an unrated senior preferred non-secured bond with a three-year maturity. The proceeds from the bond will be allocated for financing or refinancing activities aligned with Societe Generale’s Positive and Sustainable Bond Framework.
AXA and Generali Investments, representing two large institutional investors, have subscribed to the bond in its entirety through a private placement. Notably, AXA IM participated in the transaction using Societe Generale’s euro-denominated stablecoin, EUR CoinVertible, for a significant portion of the investment.
Societe Generale emphasizes that one of the notable aspects of the digital green bond is transparency and the ability to trace the origin of ESG (Environmental, Social, and Governance) data through blockchain technology. The digital green bond introduces key features to the financial market:
1. Continuous access to carbon emissions data related to the infrastructure of the digital bond through smart contracts, allowing effective monitoring of the environmental impact of the financial security.
2. Innovative payment methods using EUR CoinVertible, a digital asset issued by SG-FORGE in April 2023, in addition to traditional cash payment options.
Furthermore, the issuance highlights Societe Generale’s strategic focus on expertise in cryptocurrency services and digital tools. It demonstrates the lender’s commitment to enhancing capital market capabilities to meet the growing demand for digital assets, particularly those with ESG considerations.