Yesterday Japanese stock exchange operator JPX announced it will explore using blockchain green bonds as part of its goal of becoming carbon neutral by 2024 by switching to 100% renewable energy. It’s partnering with blockchain company BOOSTRY which has its iBet security token issuance platform, which initially targets the debt markets. Nomura and Nomura Research Institute founded BOOSTRY, and SBI is an investor.
JPX is exploring green bonds to fund investment in renewable energy generation such as solar panels or biomass power generation.
While JPX is just at the exploration stage, it sees multiple advantages in using blockchain for a green solution. One benefit is to use the technology to automatically track and transparently share data about the amount of energy generated from the solar or biomass investment. It might also explore a variable interest rate depending on whether the sustainability objectives have been reached. And finally, blockchains act as an ownership registry, making it easy to track the amount of green investments by companies.
In April, JPX Research will formally launch and oversee the green bond project.
Turning to BOOSTRY, its iBet platform was designed initially for bond issuance, in part to make it more efficient to issue securities, thereby lowering the costs and barriers to entry. In April last year, SBI Securities used the platform for a security token offering of its own corporate bond targeted at retail investors. The platform uses the Quorum enterprise blockchain.
Green bonds are a popular blockchain application because of the dual ability to track the sustainability elements as well as the investors. The BIS has a green bond research project with the Hong Kong Monetary Authority.
Green Assets Wallet is another blockchain solution. However, its focus is purely on sustainability and there is no intention to log digital asset investments. It stores documents and impact reports relating to the sustainability aspects.
Update: correction, BOOSTRY uses Quorum not Corda