Nornickel Rewards Employees with Metal-Backed Digital Assets

Nornickel, the Russian metal mining giant, has announced a new initiative to pay its employees dividends with digital financial assets (DFAs) that are backed by its metal reserves. The company claims that this is a way to return value to its workforce and promote the development of the emerging DFA market in Russia.

What are DFAs and how do they work?

DFAs are a type of digital asset that represent a claim on a real-world asset, such as metal, oil, or gas. Unlike cryptocurrencies, such as Bitcoin, DFAs are not decentralized or anonymous, but rather issued and regulated by a central authority, such as a company or a government. DFAs can be used for various purposes, such as trading, investing, or paying dividends.

Nornickel has been developing its own DFAs since 2018, with the aim of commercializing Russia’s first blockchain-powered commodities. The company obtained permission from the Russian government and the Central Bank to launch its DFA offering in 2020, using the Atomyze blockchain platform. The company’s DFAs are backed by its metal reserves, such as nickel, copper, and palladium, and can be redeemed for physical metal or cash at any time.

How does Nornickel pay dividends with DFAs?

The company’s board of directors has approved a program that will see employees receive around $10.40 per share in DFAs, as part of their dividend payout. The company’s main shareholders have also supported the idea of rewarding employees who hold the company’s minetoken coin, which is another type of DFA that represents a share in the company’s metal production.

The company has created a program called Digital Investor, which caters to employees who have been working for the company for over a year. The company said it would reward its staff with between two and 10 minetokens, depending on their seniority. The company has already distributed minetokens to 51,000 employees, and plans to complete the process by the end of January.

The company said that its DFAs serve as its unconditional financial obligation to repay the funds to the coin holders on the date determined by the offering documents. The company also said that its DFAs are compliant with the Russian legislation and the Central Bank’s regulations.

Why does Nornickel use DFAs to reward its employees?

The company’s president, Vladimir Potanin, has said that he sees the program as a form of “people’s capitalism”, and a way to redress the historical injustice that occurred when the company was privatized in 1994. At that time, employees owned a collective 25% stake in the company, but most of them sold their shares, unaware of their real value.

Potanin said that he hopes that 25% of the company’s shares are returned to the people, including the employees. He also said that he believes that DFAs are a more convenient and transparent way of distributing dividends, as they eliminate intermediaries and reduce costs.

The company also said that it aims to promote the development of the DFA market in Russia, and to demonstrate the potential of blockchain technology for the metal industry. The company said that it expects more Russian companies to follow its example and issue their own DFAs, as the legal framework for the digital assets is being prepared by the lawmakers.

The company also said that it welcomes foreign investors to participate in its DFA offerings, and that it does not see any restrictions or barriers for the international trade of its digital assets.