B2C2, an institutional crypto liquidity provider, has issued its first onchain corporate bond, according to an announcement shared with The Block on Thursday. The bond was issued in partnership with onchain debt capital markets house, PV01, which was founded by B2C2’s founders.
The bond was tokenized on the Ethereum ETH
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blockchain and denominated in the USDC stablecoin. Its entire lifecycle, from issuance to redemption and secondary transfers, will take place entirely onchain.
The firms referred to the situation as “a world first” as the asset is “documented under English law.”
“Crypto corporate bonds are our strategy’s natural next step after our U.S. Treasury-backed bonds. Crypto issuers will demonstrate that debt can be issued, traded and redeemed on the blockchain without so many intermediaries. This will pave the way for traditional companies to issue debt onchain in turn,” Max Boonen, founder of PV01, said in a statement.
The transaction builds on PV01’s previous $5 million Treasury tokenization proof-of-concept, which was done in partnership with B2C2, BlockTower Capital and Keyrock in April 2024. It is unclear how much debt was issued this time around.
Unlike tokenized Treasury products like BlackRock’s BUIDL, PV01’s products are bonds rather than funds. The firm uses a special purpose vehicle to buy a U.S. Treasury bill and issue a token that represents the bond. This token is both a representation of a bond and a bond itself.
“The landmark transaction is the first of many more to come, making it easier for digital asset companies to issue debt and one step closer to bringing the debt capital markets on chain,” a PV01 representative told The Block in an email.
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B2C2, founded in 2015 by Max Boonen and Flavio Molendin, was bought out by Japan’s SBI in 2020. Boonen and Molendin launched the Bermuda-based broker-dealer PV01 three years later. It operates as a broker-dealer for digital bonds, handling the structuring, book-building and sales process.
The startup, which targets qualified non-U.S. investors, raised $9 million in seed funding from Tioga Capital, BlockTower and Ryze Labs.
Advocates argue that tokenized bonds can reduce issuance costs, drive down transaction fees and make the whole process faster and more transparent. 21.co said the real-world asset industry could grow to $10 trillion by the end of the decade.
A number of financial institutions have turned to blockchain to test bond issuance. In 2023, Société Generale issued its first green euro-denominated on Ethereum, while in September, German industrial giant Siemens AG issued a 300 million euro digital bond on a private blockchain as part of a European Central Bank CBDC pilot.
“The Tradfi Debt Capital Markets model long overdue for upgrade, clunky issuance process, only for select privileged clients, lengthy clearing and settlement process, expensive,” the PV01 rep said.
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