The BME (Bolsas y Mercados Españoles) is preparing to test its blockchain infrastructure for the financing of small and medium-sized companies after a successful pilot test carried out in 2020.
The operator of all the securities markets and financial systems in Spain is going to test a platform that helps small and medium-sized companies to obtain financing. The novelty is that this It will be done through the issuance of participative loans and convertible promissory notes represented as digital assets on a blockchain network.
As reported by Finextra, this initiative will involve companies that are part of the financing ecosystem for SMEs in the country. All this under the tutelage of a regulatory sandbox created by the Ministry of Economy and Digital Transformation of Spain.
A regulatory sandbox focused on blockchain
This regulatory sandbox is considered a important step to promote further development of FinTech in Spain. Its goal is to generate more competition while reducing entry barriers for participants.
The entry of the project in the sandbox represents the second phase in the project roadmap. Following a successful pilot test carried out in the summer of 2020 with some investment services entities, issuers and investors. The project’s blockchain network is based on Ethereum technology.
The platform is mainly aimed at facilitating the financing of limited companies, which, in addition to their size, due to their status as SL, are limited in their financing capacity other than banks.
As part of this second round of testing, BME is likely to want to see if the Ethereum-based system for raising capital for limited liability companies outside of the traditional bank financing route is the ideal one.
Experimenting with electronic money
In order to optimize the processes in this type of financing and obtain the benefits of blockchain technology, the platform integrates an electronic money solution (EDE). In this way, users will have an e-wallet where all their assets are stored, both electronic money and financial instruments represented as digital assets.
Issuing companies may also count on the support of BME’s Pre-Market Environment. This environment is an initiative launched three years ago by BME that consists of a training and networking program for expanding SMEs to learn about the operation of capital markets and gain access to private and institutional investors.
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