- The platform aims to make the process of issuing and trading digital bonds more efficient than traditional methods, while also focusing on global sustainability by reducing its carbon footprint.
- The platform will use a protocol called Proof of Climate Awareness, which rewards node operators according to a climate-dependent formula, with the node that has the lower carbon footprint receiving the largest amount of rewards.
- This partnership highlights the increasing focus on sustainable finance and the adoption of blockchain technology by traditional financial institutions.
Traditional financial institutions continue to create new use cases by adopting blockchain. Recently, French bank Credit Agricole Bank and Swedish bank Skandinaviska Enskilda Banken (SEB) released an announcement. According to the announcement, the two banks will launch a new digital bond platform powered by blockchain technology.
The new platform, which will be called So Bond, aims to make companies issuing and trading digital bonds much more efficient than traditional methods. The data immutability provided by blockchain technology will ensure that the process is transparent and secure for all parties.
Another aim of the platform is to focus on global sustainability by reducing its carbon footprint. To achieve this, they will use a protocol called Proof of Climate Awareness. Participating nodes in this protocol are expected to be much more energy efficient when operating compared to traditional systems.
The protocol was programmed to reward node operators according to a climate-dependent formula. Whichever node has the lower carbon footprint will receive the largest amount of rewards. Developed by a company called Finaxys, this protocol has its first real-world usage area with the So Bond platform.
Romaric Rolleti, head of innovation and digital transformation at Credit Agricole Bank, said that So Bond is just one of the steps taken for the bank’s digital transformation. He continued, “The platform’s innovative approach to both blockchain infrastructure and the securities market is combined with a strong commitment to green and sustainable finance, which is at the heart of our Societal Project.”
There are many traditional finance and blockchain projects focusing on the climate crisis and environmental sustainability. Any organization that feels responsible for this issue uses different protocols to encourage individuals and institutions to reduce their carbon footprints. The fact that the two big banks of Sweden and France have established a partnership on this issue shows that the global climate crisis will remain in our lives for a long time as a “problem to be solved”.