Clean and renewable energy: The concept is simple, however, the execution is anything but. In an effort to aid the continued development and adoption of sustainable energy, worldwide tech giant, Siemens, has turned to a popular blockchain service provider – Swarm.
Today, this pairing of companies announced that Swarm has been tasked with developing an efficient, and effective, solution to facilitate the funding of energy projects in Africa. This task will be completed through use of the company’s recently announced premium tokenization service, Swarm Capital.
While details regarding the partnership are still scarce at this time, this is most definitely a positive announcement. Not only does it mark continued early adoption of Swarm Capital, but also the entrance of a global titan of industry in Siemens, into the world of blockchain.
Announced mere weeks ago, Swarm Capital is a service provider platform, offering premium services through a modular platform. This platform, which is built on the Swarm protocol, is meant to be a comprehensive solution for any company looking to tokenize an asset.
In their partnership announcement, the team at Swarm took the time to comment on why blockchain is a good fit with future energy solutions through Siemens. They stated,
“One of the most compelling use cases for tokenization is in the energy sector, which has been brought to the fore lately in public discussions concerned with energy accountability, transparency, and sustainability. The energy industry is abundant with potential use cases — from the tokenization of energy itself to the digital representation of carbon emissions.”
Swarm is a U.S. based company, which was launched in 2018. In the time since, the team at Swarm has developed a myriad of services and solutions for the digital securities sector, including specialized token standards, open protocol, and more.
Cofounders, Philipp Pieper and Timo Lehes, currently oversee company operations.
Founded in 1847, Siemens has withstood the test of time, establishing themselves as a world leader in manufacturing and tech industries. The company has done this by continually looking towards, and planning for, the future – as evident by the partnership described here today.
CEO, Joe Kaeser, currently oversees company operations.
In Other News
For a few years now, we have seen various companies attempt to integrate green energy and blockchain. We have, in the past, detailed multiple companies that fall into this camp. While integrating blockchain and green energy in a different manner than the development discussed here today, the following articles demonstrate another avenue in which the two sectors can coincide.
ZiyenCoin to Tokenize the Oil Industry
ZiyenCoin has some big plans for the energy sectors moving forward. The firm seeks to integrate both blockchain and Internet of Things (IoT) technology to reduce costs for investors and consumers. This week, the company also announced plans to host an STO to further its US market positioning.
This news showcases a strong push by the energy sector to enter the blockchain space. In the past, there have been numerous blockchain energy platforms. Most of these systems tokenized electricity. It was only a matter of time before this highly-effective business model branched out into other sources within the energy sector.
Ziyen Press Release
News of the STO first broke via an October 15, 2019 press release. In the post, Ziyen Inc.’s CEO, Alastair Caithness details some of the firm’s new strategies, including important STO information for investors.
According to Caithness, Ziyen Inc. decided to create a new subsidiary solely focused on blockchain and IoT development in the oil sector. ZiyenCoin is the new firm tasked with tokenizing the oil sector moving forward.
Additionally, Caithness explained that Ziyen is no stranger to the market. For the last couple of years, the company worked closely with many of the largest players in the oil market.
At the same time, Ziyen expanded its holdings. Originally, in 2016, Ziyen entered the market as a software company focused on providing helpful information to energy investors. The company’s data was critical for oil, gas, power, and energy sector investment firms.
In 2017 the firm pivoted to the holding oil assets under the subsidiary Ziyen Energy. Today Ziyen Energy controls 18 oil assets based in Illinois, Indiana, and Kentucky. The company wants to expand its market penetration with plans to secure and develop smaller oil fields across the US in the coming year. The STO will fund these ventures.
The ZiyenCoin STO is open to both US and Non-US investors. Interestingly, Ziyen filed its STO as a 506c Security Token Offering with the SEC. This is the same filing as JPM Morgan’s token the JPM Coin.
Speaking on the news, Dave Rogers, Ziyen Inc. board member, and product strategist described the excitement surrounding the event. Notably, Rogers gave some unique insight into being a shareholder during a period of tokenization.
He explained that at first, he was confused as to the benefits tokenization brings to the table. Today, Rogers is part of the Ziyen team where he lends his 25+ years of experience to the company’s goal of tokenizing the oil sector.
ZiyenCoin – Oil on the Blockchain
Ziyen isn’t the first company to envision a more robust blockchain-based energy sector. There are already multiple solar and electricity-based platforms in use. Uniquely, the firm is one of only a few oil-based companies making the upgrade to a blockchain-based system at this time. You can expect to hear a lot more about ZiyenCoin in the coming months as its STO continues to draw investors.
CoinShares Issues Gold-Backed DGLD Tokens
CoinShares made a splash across the tokenization community this week after announcing a new gold-backed token network. The network will allow investors to take advantage of the stability of gold, whilst still enjoying the added security and efficiency of a blockchain-based system.
How CoinShares New Platform Works
According to CoinShares’ executives, each token represents physical gold. To be exact, each DGLD token is backed by 1/10 Troy ounce. This gold is held by one of Switzerland’s premier precious metal traders MKS SA.
MKS SA – Swiss Precious Metals Trader
For their part, MKS SA will hold the gold reserves and allow for third-party auditing to occur. In total, the firm put aside just over $20 million in gold for the tokenization strategy. Notably, MKS SA already hosts a large precious metal trading network. Consequently, tokenizing their gold provides far more liquidity than traditional EFTs.
Speaking on the new tokenization strategy, CoinShares’ Chairman, Danny Masters explained the advantages of the maneuver. For one, gold is considered one of the most stable assets on the planet. Now combine that stability with the security of a blockchain network, and you get a frictionless trading system that has the capabilities to function internationally.
Eliminates 3rd Parties
Masters also discussed how CoinShares eliminates many of the third-party verification systems encountered when investing in Gold EFTs. Each of these verification steps adds costs and time to the total transaction. Now investors can eliminate these delays and save money on fees.
Gold on Bitcoin Blockchain – CoinShares
CoinShares decided to utilize the Bitcoin blockchain as its core anchor for the platform. This was a smart strategy as Bitcoin is the largest and most secure blockchain on the planet. To make the concept a reality, CoinShares incorporated CommerceBlock’s Ocean sidechain.
Sidechains Are the Biz
Sidechains such as Ocean, Liquid, or the Lightning Network allow users to conduct faster transactions with fewer fees. Also, these second layer protocols enable developers to utilize additional functionalities not found on the original Bitcoin blockchain.
Smart contracts are a perfect example of how sidechains benefit Bitcoin. Technically, Bitcoin’s blockchain can handle smart contracts but it’s far less capable than the robust capabilities found in the Ocean sidechain.
Partnered with BTC Wallet Provider – Blockchain
Another key component of the venture is a strategic partnership with the crypto wallet provider Blockchain. Blockchain needed to create a means for investors to store their gold-backed crypto easily and efficiently.
CoinShares’ new gold-backed token is open to both retail and institutional investors. Currently, the product is available in 200+ countries via Blockchain’s crypto exchange – PIT. Notably, the platform requires AML and KYC adherence as part of the company’s regulation-friendly approach to the market.
CoinShares is ready to provide clients with a stable alternative in the crypto sector. The firm has years of experience connecting traders with profitable tokens. Now, CoinShares wants to take its experience and enter the tokenized precious metals markets in a major way. You can expect to see more headlines from these developers as CoinShares’ strategy unfolds over the coming weeks.
Tokenized Gold Finds Support through SALT and NEXO upon Launch
Tokenized Gold aka ‘Pax Gold’
This past week brought the launch of PAX Gold. This new offering functions as a stable coin, backed by physical gold. The product was created, and launched, by PAXOS – a popular creator of various stablecoins, gaining adoption within the world of blockchain.
Most industry participants believe that valuable assets suffering from illiquidity are the perfect candidates for tokenization through blockchain. Gold fits this categorization perfectly – with PAX looking to capitalize.
PAX Gold is an ERC-20 based token, with each one representing one fine troy ounce of gold. This tethering to gold allows for the tokens to mimic gold markets. It also allows for holders to invest indirectly in precious metals, albeit in a more efficient manner, as the tokens are more liquid, and do not require storage fees.
Interest Accounts and Collateral
Upon launch, there was immediate adoption of PAX Gold, as multiple companies spoke out, indicating their upcoming support for the asset through various means. More specifically, two blockchain based lending platforms – NEXO and SALT – stepped up. The former will offer interest bearing savings accounts funded by PAX Gold, while the latter will facilitate crypto-loans which use PAX Gold as collateral.
This inclusion of PAX Gold within multiple platforms, such as those offered by SALT and NEXO, points to a bright future for stablecoins.
Whether being utilized as collateral, or a means of growing funds in an interest bearing account, industry acceptance of stablecoins continues to grow. Participants in the industry have recognized their ability to function as on/off ramps into crypto, and are now striving to support this.
In the last week, representatives from Paxos, SALT, and NEXO, have each taken the time to comment on their usage of PAX Gold. The following is what each had to say on the matter.
Charles Cascarilla, CEO of Paxos, stated,
“In a digital and global financial system, owning physical gold is a cumbersome, outdated investment; it’s not easy to trade, divide, move or leverage against other investments. While it’s easy to trade gold derivatives – ETFs, futures and unallocated gold – these are synthetic representations, not legal ownership of physical gold, and have limited accessibility. Gold purchased through unaccredited retail outlets is not only expensive, but also risky as the quality and provenance of the gold are unverified…PAX Gold solves these fundamental challenges. It’s as easy to trade as ETFs or bitcoin, is extremely mobile and divisible, and it also gives holders ownership to the highest quality gold in the world. It’s never been easier to own or trade gold and we are thrilled to give both institutions and individual’s access to gold in a faster and cheaper way. By putting gold on a blockchain, we’re democratizing access to gold.”
Jenny Shaver, COO of SALT, stated,
“Precious metals are ideal for tokenization. Gold, as an example, has well-established institutional physical custody and a broad base of investors familiar with the asset class…Gold has traditionally been held as a hedge against inversely correlated assets like stocks and fiat currency, so it provides digital token holders with familiar asset diversification options. By offering PAX Gold as our newest collateral type, we’re adding value for our customers by combining the benefits of gold investing with easy access to funds via crypto-backed lending.”
Based in London, England, NEXO is a blockchain loan company which was founded in 2017. Notably, they provide their clientele with access to instant loans/credit lines backed by crypto-assets. Operations have expanded to include interest bearing savings accounts.
This Denver, Colorado, based company was founded in 2016, and specializes in crypto-backed loans. In the time since their inception, SALT has managed to expand services to a variety of countries, including, but not limited to, the following:
- United Kingdom
- United States
- New Zealand
In Other News
NEXO is not the first company to offer interest bearing accounts funded with a stable coin. While they may be the first to utilize PAX Gold, others, such as BlockFi, already offer similar products. We recently took a brief look at some of the various stablecoin offerings on the market, and how they play a role in the BlockFi platform.