• Lamar Olive Oil has issued an on-chain bond using Obligate, a DeFi platform based in Switzerland.
• The bond is denominated in Membrane Finance’s EUROe, the only EU-regulated crypto stablecoin.
• The underwriting and structuring process was conducted by Obligate’s credit rating partner Credora.
Olive Oil Producer Issues Euro-Stablecoin Bond
Lamar Olive Oil, a French sustainable agriculture business, has issued an on-chain bond using Obligate’s decentralized finance (DeFi) platform. This debt sale marks the first of its kind for the industry and is denominated in Membrane Finance’s EUROe, which is the only EU-regulated crypto stablecoin.
The underwriting and structuring process including credit evaluation and ongoing risk monitoring was conducted by Obligate’s credit rating partner Credora.
Lowering Barriers to Access Funding
Obligate, which is built on the Polygon blockchain, helps small and medium-sized enterprises access funding with lowered thresholds to issue bonds. Smart contracts replace the role of issuer and paying agent in the settlement layer of a traditional bond issuance. This allows greater access to funding for companies in developing and emerging markets that otherwise wouldn’t have access to more traditional sources of capital.
The Benefits of Blockchain Issuance
Blockchain technology provides numerous advantages over traditional bond issuance models including increased transparency, better liquidity management and reduced counterparty risk. By taking advantage of these benefits, Lamar Olive Oil can expect improved market efficiency when it comes to selling their bonds as well as lower transaction costs due to automated processes replacing manual ones. Additionally, since blockchain transactions are immutable they provide greater security against potential fraud or tampering with records than other methods used for recording financial information such as spreadsheets or databases.
Membrane Finance’s EUROe Stablecoin
EUROe is a regulated stablecoin that is backed 1:1 with euros held in escrow accounts at major European banks that are subject to monthly audits by independent auditors appointed by Membrane Finance itself. It enables users to hold euro balances on public blockchains without any counterparty risk associated with centralized exchanges while maintaining compliance with existing regulations for payments within Europe or across borders where euro is accepted as a currency of settlement between two counterparties..
Conclusion
Lamar Olive Oil’s issuance of an on-chain bond denominated in Membrane Finance’s EUROe demonstrates how blockchain technology can be utilized to improve access to financing for companies operating across different industries globally while complying with existing regulations at the same time. With this new development, entrepreneurs from developing countries will now have more options when it comes to raising funds for their respective businesses without having to worry about overly burdensome restrictions placed upon them by traditional financing sources such as banks or venture capitalists.