Millions of greenhouse gas emissions credits are tied to new cryptocurrencies, and fast-growing markets are attracting investors like DeFi projects and billionaire Mark Cuban, according to a report from the Wall Street Journal. I’m fascinated.
Proponents say cryptocurrencies can bring more transparency to carbon credits resulting from projects such as the establishment of renewable energy farms. Many companies buy them to supplement their emissions. However, although the project is third-party certified, credit is traded in an unregulated market.
Among market participants, the WSJ emphasized Toucan, a decentralized finance project that allows carbon credit owners to link to a digital token called BCT, which was released in October. BCT stands for Base Carbon Tonne and tokens can be traded on cryptocurrency exchanges.
According to the WSJ, over 17 million carbon credits are associated with BCT tokens. According to CoinGecko, tokens traded as much as $ 5.59 on Monday and are worth about $ 95 million on crypto exchanges.
Toucan is working on a voluntary carbon market review by providing WSJ with real-time pricing information and public records of transactions to track who can trust a funding project to improve the climate. He said he was out.
The report states that BCT transactions are being driven by another crypto asset operated by Klima DAO, Klima. Decentralized Autonomous Organization allows people to buy Klima tokens traded on cryptocurrency exchanges with BCT tokens. DAO then stores the BCT tokens in its national treasury and removes them from distribution. Over 14 million BCT tokens follow this route and cannot be used for carbon offsets.
The WSJ reported that Klima’s almost anonymous developers have stated that tokens also help the climate by reducing the availability of carbon credits and boosting prices. As a result, carbon offset projects will become more profitable and will spur further creation of climate-friendly initiatives.
But skeptics have told the WSJ that Klima could actually reduce the transparency of the carbon market.
As part of that, a toucan nonprofit told the newspaper that the creators of KlimaDAO were anonymous, saying “their actions are completely transparent,” and Klima spends millions of dollars on projects to improve the climate. He said he threw it.
The Dallas Mavericks owner, Mark Cuban, said he owns Klima’s tokens, but didn’t say how many he made or how much he made, the report said.
“Anonymity isn’t optimal and it’s a little learned experience, but if it works, the environmental impact can be consequence,” Cuba told the WSJ.
Credits are effectively associated with newly created cryptocurrency tokens, according to a WSJ report released Monday, with some market participants on projects aimed at technology helping the climate. It states that it will create incentives. The large amount of energy used to mine Bitcoin has made the cryptocurrency less environmentally popular.