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Nornickel Aims to Create an Exchange for Tokenized Commodities
October 07  |  2 min read

Nornickel Launches a Palladium-Backed Token

The COIN360 Editorial Team

One of the world’s largest producers of palladium and refined nickel, Norilsk Nickel, is launching a palladium-backed token and an exchange for tokenized commodities, shared Russian company CEO Vladimir Potanin in the interview.

According to Potanin, the Nornickel token and exchange will provide a more efficient and flexible way to manage sales contacts and open a new gate for all types of investors, including retail. The tokens will be backed by Nornickel’s guarantee to ship the corresponding amount of metal, or by special metal bank accounts for those who do not need palladium itself.

“For example, you see palladium is going up, but you can’t go to Norilsk Nickel and buy palladium for several million dollars,” Potanin explained, adding “Say, you have $500 in your pocket, and you want to bet on the price of palladium. You enter our platform and get a little portion of palladium in a tokenized form.”

The company itself will benefit from exploiting blockchain technology due to lowering the cost of transactions while managing contracts, and getting access to “interesting source of capital with very low transaction costs” to finance “working capital”, shared CEO. In future, Potanin plans to add more goods to the platform, like airplane tickets or shipping containers.

Nornickel token was developed on Hyperledger Fabric and, according to Potanin, got support from IBM, after joining the Hyperledger community earlier this year.

Nornickel CEO also shared that the project aims to be “100 percent regulated”, and therefore, needs “both the U.S. regulators” decision and Swiss FINMA’s approval to launch operations under these countries jurisdictions. In Russia, Potanin works on promoting a blockchain regulation bill and claims to have “very advanced discussions” with the Russian central bank regarding his project.