Introduction
The so-called “Regenerative Finance” space, a movement that advocates using cryptocurrencies to transform the economy to become more inclusive and sustainable, has boomed in the past year.
We are currently seeing 500+ projects working to overcome the shortcomings of the traditional ESG market and lay the groundwork for effective and efficient capital allocation to sustainable assets. And there are more and more every week.
A key aspect in the ReFi space is the mapping of CO2 certificates on the blockchain. Potential benefits are the possibility for fractionalized and automated offsetting, increased transparency & traceability as well as liquidity, but also accessibility — especially for private investors.
Currently, there are various ways to get certificates on-chain. All with different methodologies, underlying technologies and security standards. And thus also different implications for compliance, tax & accounting as well as legal aspects. Investments currently require individual analysis and due diligence based on a lack of standardization.
Over the last few weeks, we have already discussed the different approaches in our 6-part series “Tokenisation of Carbon Credits: A six-part series on the different options for transferring certificates up the chain”.
About the Industry Overview
With the industry map above, we would like to give you a glimpse of the various issuers of tokenised CO2 certificates, as well as the associated communities, in order to convey an impression of the diversity of providers.
There are currently 150+ projects worldwide, which can be roughly differentiated into the categories “Tokenized Carbon Credits & Crypto-native Credits”, Carbon NFT’s and DAO’s, whereby the classification is not always clear-cut in individual cases, as providers sometimes map several classifications with their product range.
The distribution of the projects among the corresponding categories is as follows:
- Tokenized Carbon Credits & Crypto-native Credits — 65 Projects
- Carbon NFT’s — 49 Projects
- DAO’s with associated Tokens—54 Projects
For more information and facts about the projects, for example which blockchain ecosystems were used, how the local distribution of issuers is or which dimensions can be used to assess the quality of an individual project, feel free to sign up for our upcoming database demo.
What’s next?
For 2023, we expect further adaptations by private investors and especially companies from the Web 3.0 sector.
With Polygon and Algorand, the first large ecosystem providers have started to offset their historical carbon footprint. At the same time, we will also see more and more established companies doing blockchain-based offsetting, following pioneers like Shopify or Bayer.
In order to do so, a better data basis and corresponding comparison possibilities still need to be created. Furthermore, the underlying technology must move more into the background. From our perspective, blockchain-based offsetting must be possible without its own wallet and the bypass via decentralised exchanges in order to establish mass adoption.
Simultaneously, we will witness an increasing number of other ESG-related and blockchain-based projects. There are already 350+ projects worldwide on topics such as biodiversity, circular economy, green mobility, trustworthy donations, project finance, supply chain traceability, green currencies and other payment solutions, as well as renewable energy.
Tokenised CO2 certificates are just the beginning.
About the Team
Nadine, Wolfram and Timm combine competences from various areas such as operations, corporate communications, business development, finance, regulation, accounting and consulting.
As the Bloomberg for ESG tokens, they create a holistic database for tokenized, sustainable assets and ecosystem-based tokens that offers a trusted, one-stop solution for investors and companies. They empower sustainable, data-driven decisions in the Web 3.0 space.
Nadine Wilke
Nadine.wilke@particula.earth
