Key Points
Société Générale, the third largest bank in France, recently completed a repo transaction with the Banque de France.
This transaction was conducted via blockchain technology.
On December 13, a press release announced the completion of the transaction.
The deal involved bonds that were issued on the Ethereum (ETH) blockchain.
These bonds were used as collateral in exchange for central bank digital currency (CBDC) from the Banque de France.
First Repo Transaction Using Digital Securities
The announcement highlighted this as the first repo transaction with a central bank using digital securities.
It showcased the potential of blockchain technology in streamlining interbank operations such as refinancing.
The potential of CBDCs to enhance liquidity in digital financial markets was also emphasized.
“Société Générale deposited as collateral with the Banque de France some bonds issued in 2020 on the public Ethereum blockchain in exchange of CBDC issued by the Banque de France on its DL3S blockchain,” Société Générale stated.
This transaction comes after Société Générale’s recent foray into blockchain with its digital green bond issue.
In December 2023, the bank issued nearly $11 million in senior preferred unsecured bonds on the Ethereum blockchain.
These bonds were fully subscribed by AXA Investment Managers and Generali Investments.
AXA Investment used Société Générale’s euro-denominated stablecoin, EUR CoinVertible, for the purchase.
The proceeds were allocated to environmental projects.
The latest repo transaction was spearheaded by SG-FORGE, a subsidiary of Société Générale.
Founded in 2018, SG-FORGE was created to support the issuance, management, and settlement of digital assets, as stated in the press release.