Coindesk Logo

Danish Red Cross Backs $3M Blockchain Volcano Catastrophe Bond

Danish Red Cross Backs $3M Blockchain Volcano Catastrophe Bond

Danish Red Cross Backs $3M Blockchain Volcano Catastrophe Bond

The volcanos, situated in Cameroon, Chile, Colombia, Ecuador, Guatemala, Indonesia and Mexico, were selected based on "the significant humanitarian threat they represent."

The volcanos, situated in Cameroon, Chile, Colombia, Ecuador, Guatemala, Indonesia and Mexico, were selected based on "the significant humanitarian threat they represent."

The volcanos, situated in Cameroon, Chile, Colombia, Ecuador, Guatemala, Indonesia and Mexico, were selected based on "the significant humanitarian threat they represent."

AccessTimeIconMar 22, 2021, 4:30 PM
Updated Aug 19, 2021, 8:14 AM

Presented By Icon

Election 2024 coverage presented by

Stand with crypto

The Danish Red Cross has partnered with a number of firms to launch the first $3 million blockchain-backed catastrophe bond for volcano-related disasters.

  • The “first of its kind” catastrophe bond will allow the Danish Red Cross to access funds immediately to assist those in need should any one of 10 identified volcanoes erupt, according to a Reuters report.
  • The volcanos, situated in Cameroon, Chile, Colombia, Ecuador, Guatemala, Indonesia and Mexico, were selected based on "the significant humanitarian threat they represent, with at least 700,000 individuals living within 60 miles (100 km) radius of a potential eruption," reports the Intelligent Insurer.
  • The charity worked with blockchain technology from Replexus, insurance firm Howden Group and risk management platform Mitiga Solutions to launch the bond, offering investors high yields that would not pay out if a catastrophe occurs, said the publications.
  • “Our model can anticipate the trajectory of the volcanic ash cloud using prevailing winds to better estimate the impact and more effectively guide CAT bond proceeds," said Alejandro Marti, CEO and co-founder of Mitiga Solutions.
  • By using the private blockchain developed by Replexus the charity will reduce costs by $200,000-$400,000 per issue compared to using a traditional settlement system.
  • Investors in the catastrophe bond include Schroder Investment Management, Solidum Partners, and Plenum Investments.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information have been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. CoinDesk employees, including journalists, may receive Bullish group equity-based compensation. Bullish was incubated by technology investor Block.one.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.