Vladimir Potanin will launch a token secured by palladium on the basis of foreign branches of Norilsk Nickel

Vladimir Potanin will launch a token secured by palladium on the basis of foreign branches of Norilsk Nickel

General Director of MMC Nornickel Vladimir Potanin plans to launch a palladium-secured token and exchange of tokenized commodities. The token will be released on Hyperledger Fabric and developed with support from IBM.

In an interview with Coindesk, Vladimir Potanin told how he plans to present metals as digital assets (created with the help of IBM), to optimize his business using distributed databases based on the Hyperledger platform and to provide investors with new ways to participate in his business. He wants more Russian enterprises to think about how to use blockchain technology.

Potanin became interested in blockchain thanks in part to the creator of Ethereum, Vitalik Buterin. Once he invested in an analytical startup founded by a friend of Father Buterin. Although the entrepreneur did not personally meet with Buterin, he heard Vitalik talking about the blockchain and was intrigued. He said:

“The information about what he is doing and what he has achieved inspired me and made it clear that the younger generation is moving in this direction. I thought that I should know what they are doing and why, and I should benefit from this experience. ”

Learning more about the blockchain, he came to the conclusion that Norilsk Nickel could benefit from the introduction of the principles of this technology, for example, from the use of distributed databases to manage data about the Internet of things from its melting operations.

In addition, Norilsk Nickel will issue its own token, as reported
in the spring, providing a new, more flexible way to manage sales contracts, and a new way for investors to participate in the company.

Palladium Tokens

“We are trying to digitize all of our sales contracts; this seems like a more efficient way of doing business. Transaction costs are lower and we are becoming more flexible for our customers, ”said Potanin.

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Sometimes Norilsk Nickel customers, such as car companies, may order too much palladium, and they need to review their contracts and buy less than they originally ordered. Potanin notes that such situations are easier to solve if the contracts are tokenized.

“If you do not need a certain amount of material, you can divide the token into parts and sell it to other customers. And nothing changes for us: we send palladium, and customers receive as much as they need. ”

According to Potanin, tokens will be provided either with a Norilsk Nickel guarantee for the shipment of actual tons of metal, or with special metal bank accounts if the buyer does not need palladium. This summer, the company joined Hyperledger, and the token will be issued on the basis of Hyperledger Fabric and supported by IBM.

Norilsk Nickel also plans
launch a platform where company tokens and similar tokens supported by assets issued by other companies will be sold. Potanin says the palladium-token secured will be available not only to funds and asset managers, but also to retail investors:

“For example, you see that palladium is growing, but you cannot go to Norilsk Nickel and buy palladium for several million dollars,” Potanin said. “Let’s say you have $ 500 in your pocket and you want to bet on the price of palladium. You go to our platform and get a small amount of palladium in tokenized form. ”

Not everyone wants to invest in a company when the investor’s goal is to gain access to the main product, Potanin said:

“Investments in Norilsk Nickel are investments in Russia, mining, the ruble and other enterprises. Some people like it because the company’s stock is rising. But some people simply don’t have enough experience to work with such investments. ”

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He cited the real estate situation as an example: “If you want to buy an apartment, this does not mean that you want to buy a stake in a construction company.” According to Potanin, asset-backed tokens can be especially interesting for traditional businesses, as they will help attract money from cryptocurrency investors.

“This is an interesting source of capital with very low transaction costs,” he said. “It can be an attractive way to finance working capital.”

Work in different jurisdictions

Norilsk Nickel is preparing to launch a token with the help of companies that the company creates in the USA and Switzerland.

“We decided not to risk our reputation and be 100% regulated,” explains Potanin. “We are sure that we are in alliance with the regulators of both countries. To launch, we will need both the decision of the US regulatory authorities and the approval of FINMA in Switzerland. ”

In addition, Potanin notes that in Russia, Nornickel is conducting a “very active discussion” with the Central Bank to launch a pilot project to tokenize other goods, from air tickets to containers for shipping.

Potanin participated in the development of the bill
on digital assets in Russia as a member of the blockchain working group within the Russian Union of Industrialists and Entrepreneurs. The businessman is confident that the bill will be adopted in the near future.

“I hope that he will go through parliament without delay, and I will gain the understanding that I can start my experiment in Norilsk within the framework of this legislation and under the control of our regulator.”

Risks and Opportunities

Vladimir Potanin notes that he is not particularly interested in cryptocurrencies, for example, bitcoin and ether, and does not invest in them. He calls bitcoin “a toy” and “a useful souvenir,” but says that the issue of electronic money should be left to central banks.

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“I agree with the US regulator that this is a commodity and its main problem is that you buy it at your own peril and risk,” he added.

At the same time, he enthusiastically looks at the future of asset-backed tokens, similar to the one that is being prepared for the release of Norilsk Nickel, since their usefulness goes beyond speculative value, motivating people to learn about digital goods that they will trade:

“People like different types of bets, for example, for football or boxing matches. My idea is to encourage people to bet on something real and learn something: what happens to oil, metals, environmental programs, what consumer behavior is. ”

Given Potanin’s high authority and his relationship with the government, someone might wonder if the Norilsk Nickel token project is a well-thought-out way to circumvent the sanctions imposed on Russia by the United States and Europe. But Potanin rejects this idea. So far, neither he nor Norilsk Nickel have been faced with direct Western sanctions.

However, he does not believe that such problems can stop his blockchain project:

“In the system that now exists in the world, digital, high-tech and environmental initiatives are the last to be attacked and compromised. This is not a panacea, but I think it’s right to work in this direction. ”


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