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BNP Paribas signs partnership to issue mini-bonds on the blockchain
French Bank BNP Paribas has signed a partnership agreement with crowdfunding providers Lendosphere, Enerfip and Lumo to enable private companies to issue mini-bonds through a private blockchain.
Through a new digital lab, the bank is working on a distributed ledger based on the blockchain powering bitcoin that will be able to maintain a record of all mini-bonds issued through the platform, as well as all of the changes in their ownership.
BNP Paribas claims that the use of the blockchain will ensure that transactions across the network are performed more securely, as well as faster and more efficiently. The bank aims to deliver the new platform by the end of 2016 with a launch to follow once a pending French law on mini-bonds receives final approval.
“Blockchain technology is particularly suited to the fundraising needs of private companies as transactions volumes are typically lower than for listed companies,” BNP Paribas Securities Services Innovation & Digital Lab Manager Marc Younes said in a statement. “This technology could also serve to standardise processes around the trade lifecycle of mini-bonds.”
Expansion
The announcement of the partnership appears to be part of BNP Paribas’ ongoing expansion into the blockchain space. That included the opening of a dedicated blockchain research facility and its first blockchain Bizhackathon for the Americas platform in New York on Sept. 7 and 8. According to AllCoinNews, that event saw participants explore how the technology can advance the consumer-client experience and improve the efficiency of the services offered in different areas of BNP Paribas’ CIB platform.
BNP Paribas has become prominent in blockchain industry groups and is a member of the European CDC initiative, the R3(CV) Consortium and the board of the ever-growing Digital Asset Holdings.
Most of these initiatives remain in their earlier stages. However, what BMP Paribas is offering here is planned for real-world testing by the end of the year, making it yet another milestone along the path of financial market blockchain revolution.
Image credit: Wikimedia Commons/ Public Domain CC0
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