Global Manufacturing Giant Siemens Issuing First Digital Bond on Blockchain
German manufacturing giant Siemens has launched its first bond on blockchain in an effort to streamline sales processes and reach potential buyers directly. The company announced the issuance of a US$60 million (US$64 million) digital bond in a statement circulated on February 14.
The bond in question was issued on the public Polygon blockchain and has a maturity of one year. Other details of the debt instrument, such as the interest rate, were not disclosed.
Siemens listed some of the benefits of leveraging blockchain technology to issue these types of instruments. Compared to the traditional process, the use of blockchain makes “global paper certificates and central clearing unnecessary,” according to the press release.
The issuance of the technology-based bond takes place thanks to regulations in Germany approved in 2021 via Act on electronic securities. Siemens has used the new opportunities to Act on electronic securities and sold the securities directly to investors without involving established central securities firms. Payments were made using classic methods as the digital euro was not yet available at the time of the transaction.
Peter Rathgeb, company treasurer in Siemens AG, for his part, added that the use of the blockchain allows operations to be carried out much faster and more efficiently, compared to the traditional system. He announced that the company plans to continue “actively” promoting this development.
Global manufacturing giants are embracing the blockchain
Siemens’ move is important because it is one of the world’s leading diversified manufacturing conglomerates. The company operates in a wide range of industries, including energy, healthcare, transportation and manufacturing.
Siemens operates in over 200 countries and employs more than 300,000 people worldwide. The company’s products and services include power generation and distribution systems, medical equipment, transportation systems, building automation and industrial automation solutions. Siemens is also involved in research and development in areas such as artificial intelligence, cyber security and renewable energy.
In recent years, Siemens has invested in digitization and has developed a number of digital solutions for various industries. For example, the company’s MindSphere the platform provides data analysis and connectivity for industrial applications, and its Sim center software helps engineers simulate and test products in a virtual environment.
The company was founded in Berlin, Germany, in 1847 by Werner von Siemens and Johann Georg Halske, and it has since grown to become one of the largest engineering companies in the world.
