R3 Sustainability and Chintai launch $795M ESG fund

R3 Sustainability has partnered with Chintai to introduce a new blockchain-based investment fund valued at $795 million, focusing on environmental, social, and governance (ESG) initiatives.

This fund is part of the expanding real-world asset (RWA) tokenisation sector, which involves converting tangible assets into digital tokens on a blockchain, enhancing accessibility for investors.

According to Josh Gordon, managing director of Chintai, tokenisation offers “direct, efficient and scalable ways to access liquidity,” which can significantly lower investment costs.

Gordon emphasised that this initiative aims to transform capital flows into industries traditionally dominated by high-cost investment banks.

The launch of the fund coincides with a surge in interest in RWAs, as data shows the total value of on-chain RWAs reached $17.1 billion across 82,000 asset holders.

Kyle Granowski, founder of R3 Sustainability, highlighted the potential impact of this fund on sustainable utility infrastructure in the U.S., noting that these projects often require multiple rounds of investment.

The fund will support four major sustainability programs: a $50 million energy-efficient housing initiative, a $165 million early-stage industrial development fund, a $180 million desalination plant project in Texas, and a $300 million resource efficiency program aimed at converting wastewater solids into fertilizer.

Granowski pointed out that the American Society of Civil Engineers estimates a $105 billion funding gap in U.S. water and wastewater infrastructure, underscoring the importance of this investment opportunity.

With projections indicating that the RWA sector could grow between $4 trillion and $30 trillion by 2030, this fund represents a significant step forward in leveraging blockchain technology for sustainable investments.