Société Générale blockchain issuance a sign of things to come

Author: John Crabb | Published: 16 May 2019

French bank Société Générale has issued a €100 million ($111.7 million) covered bond on the Ethereum blockchain in the form of a security token. Although the bank itself was the sole buyer of the bond, the issuance shows the debt capital markets are looking at ways to change the status quo with disruptive technologies such as blockchain.

The issuance comes on the heels of a new set of French laws governing the sector. The Plan d'Action pour la Croissance et la Transformation des Entreprises (PACTE) seeks to help create an improved environment for the growth of start-ups and digital asset providers. One measure guarantees those in the crypto space access to bank accounts, something frowned upon in the US.

The bond is the latest in a number of financial instruments to be issued using Ethereum and other, often private, blockchains. Last August the World Bank and the Commonwealth Bank...