Nornickel uses blockchain for new ETC on Deutsche Börse and LSE

Nornickel uses blockchain for new ETC on Deutsche Börse and LSE

A palladium fund launched by Norilsk Nickel is set to launch ETCs for metals on Deutsche Börse and the London Stock Exchange.

The world’s largest producer of palladium and high-grade nickel Norilsk Nickel is expanding its digital technology strategy. Since 18 January, Nornickel’s Global Palladium Fund has launched Bitcoin Bank exchange-traded commodities (ETCs) for metals on Deutsche Börse, which are held in custody by TokenTrust AG. This also uses their distributed ledger platform Atomyze.

Nornickel’s Global Palladium Fund plans to launch the ETCs on the London Stock Exchange „within days“. An ETC is an instrument that can be traded like a share, giving traders and investors exposure to an underlying commodity, in this case metals. Nornickel’s fund will bring palladium, platinum, gold and silver into the newly launched ETC instrument and will work with Swiss company TokenTrust AG on custody of the metals and on a tokenisation strategy.

TokenTrust will provide the fund with a distributed ledger technology-based platform called Atomyze. This is built on Hyperledger Fabric and will be used to immutably record metal information and to tokenise a portion of the mining group’s contract volume.

CEO of Nornickel’s Global Palladium Fund Alexander Stoyanov

The ETC instruments are offered at the spot price on the London Metal Exchange (LME) and provide additional guarantees about the origin of the commodities being bid through the use of distributed ledger technology to monitor and verify standards. CEO of Nornickel’s Global Palladium Fund Alexander Stoyanov said:

„With our way of digitising commodities, we can capture and trace the source of the underlying metals and how they were produced. And that’s in conjunction with ESG claims. Nornickel, whose products we carry, sets a new standard for responsible mining because it fully complies with the UN2030 Charter and existing LBMA metal source standards. This gives our ETC platform a clear differentiator.“

Nornickel recently joined an initiative called the Responsible Sourcing Blockchain Network, which was established to improve transparency, traceability and verification of sustainable practices in the global minerals and metals industry. The network is built on the IBM Blockchain platform, which is also based on Hyperledger Fabric.