Siemens Issued its First Digital Bond on Polygon

Siemens, Germany’s thirdlargest publicly traded company by market capitalization, has made a groundbreaking announcement about its first digital bond issuance worth €60 million ($64 million) on the Polygon blockchain. This achievement has been made possible through Germany’s Electronic Securities Act, which came into effect in June 2021 and permits the sale of blockchain-based debt to occur.

Through blockchain-based bonds, Siemens anticipates a reduction in paperwork and a direct approach to potential investors without intermediaries like banks. This bond has a maturity of one year and, as reported by CoinDesk, makes “paper-based global certificates and central clearing unnecessary,” as stated by the company. Additionally, the bond can be directly sold to investors without requiring banks to operate as intermediaries.

Siemens did not state the bond’s interest rate, but it hopes to accelerate and make such transactions more efficient in the future. Peter Rathgeb, corporate treasurer at Siemens, said, “By moving away from paper and towards public blockchains for issuing securities, we can execute transactions significantly faster and more efficiently than when issuing bonds in the past.”

Since 2021, Siemens, a German engineering and manufacturing powerhouse, has been actively exploring blockchain technology’s potential in various areas, including payments and debt issuance. It partnered with JPMorgan Chase in 2021 to develop a blockchainbased payment system that automatically transfers money between Siemens’ accounts, simplifying and streamlining payments, reducing the need for intermediaries, and enabling faster and more efficient transactions.Siemens’ announcement regarding the issuance of its first digital bond on the Polygon network caused a 7.21% increase in the MATIC token price during trading on February 14. The current price of MATIC stands at $1.25.