Can Blockchain Boost the Transparency of Climate Credits?

Many companies are beginning to use blockchain technology to boost the transparency of carbon credits.

Blockchain and Carbon Credits… Are They Coming Together?

Carbon credits are designed to help companies bankroll protocols and projects that ultimately preserve the environment from poor or improper climate activity. However, the problem with these credits is that they are not always transparent, and it’s not entirely clear if they’ve been effective when it comes to keeping the planet and its atmosphere clean and clear from pollution.

Blockchain is presenting several answers for companies like Toucan, Return, and Open Forest Protocol, and they’re seeking to tie climate initiatives in with the illustrious technology that has powered the crypto arena for so long.

The way climate credits work is that they are bought by companies who spew greenhouse gas emissions such as methane into the atmosphere through their operations. These credits are then put towards environmentally friendly projects and initiatives. Think of them as companies’ way of saying “we’re sorry” for all the alleged damage they may be doing to the planet.

This way, for every poor initiative that occurs through the company’s operations, they can at least make sure a project seeking to offset any emissions has what it needs to stay afloat and keep working. Sadly, it’s never been clear if these projects are doing what they say they do, nor is it clear if their methods for cleaning up the planet truly work.

Erin Murphy – the chief growth officer at Topl, a company that’s designed a blockchain specifically for climate-based issues – said in a recent interview:

It’s a fundamental issue in the [industry]. We want to see more competition [and] more scientific rigor in this space.

Many believe blockchain can provide the answers eco-friendly individuals seek. Blockchain can give them specific information by bringing together several different groups to ensure a project’s merits are in place. They can also see to it that participation in these projects is incentivized, and that general criteria for issuing and using climate credits are laid out properly.

Salmeron Barnes – the co-founder and managing director of Aureus Earth, which builds financial tools to encourage carbon reduction – said in an emailed note:

The decentralized verification capability and the promise of new low-emissions blockchain offerings are what attracted AE to create a blockchain-based registry.

An Interesting Reversal of Sorts

Interestingly, blockchain is centered in a world that has long been criticized for its alleged lack of ecological and environmental awareness. Blockchain powers crypto, which was born through the mining process, and it’s this process that has attracted so much hate from environmentalists over the years.

Many claims have been made that crypto mining ultimately uses more energy than most developing countries, and that the process is pushing the planet towards an unforgiving (and irreversible) end.

Tags: blockchain, climate credits, Salmeron Barnes