Bitcoin Suisse, one of the largest digital asset players in the country, has issued a digital bond via the Obligate platform. When asked for more details about the bond, Bitcoin Suisse told Ledger Insights that it is a technical prototype with a 12 month maturity, available only to qualified investors.
The issuer claims to be the largest digital asset custodian in the country. With CHF 5 billion ($5.6bn) in assets under custody that sounds about right. Around 40% of those assets are part of its staking solution, which together with crypto trading contribute significantly towards its revenues. However, the company made a loss of CHF 13 million in 2023. It managed to recover that and more in the first quarter of 2024 with a profit of CHF 17.2 million.
The purpose of the bond is to fund its digital asset lending solution and the bond is over-collateralized. With Circle as Obligate’s backer, the issuance is atomically settled using USDC as the settlement currency.
“By facilitating this tokenized bond issuance, we empower institutional-grade brokers and custodians like Bitcoin Suisse, who custody billions in assets, to leverage our advanced blockchain technology, robust legal framework, and collateralization capabilities,” said Stephan D. Meyer, Co-Founder and CLO at Obligate.
Ten year old Bitcoin Suisse had planned to become a bank but abandoned that strategy when Bitcoin’s price rebounded last year. As a result of the strategic change, it has a new CEO, one of its co-founders, Andrej Majcen.
Meanwhile, Obligate (formerly FQX) has a tokenization solution for promissory note and bond issuance. The startup’s partners include Credit Suisse and SIX, the Swiss stock exchange group. Last year SIX also chose to invest in Obligate alongside stablecoin issuer Circle.
Obligate started out using Hyperledger Fabric for issuance but switched to public blockchains more than two years ago and now mainly uses Polygon POS.
In March Obligate hosted a bond issuance for Metavisio (Thomson Computing). It claims it was the first digital bond issuance for a public company that didn’t involve traditional banks. We note that Siemens issued a public blockchain bond without using a CSD. However, the Siemens bond was organized by German bank Hauck Aufhäuser Lampe Privatbank.
