Jan 28, 2021
Weekly Token: All you Need to Know About UPCO2
How UPCO2 is contributing to making this world a better place?
Universal Carbon or UPCO2 is the world’s very first carbon token that is tradable on a public blockchain. It is eco-friendly that when you buy UPCO2, you are supporting the preservation of the rainforests. Carbon emission trading has been one of the most discussed options in fighting climate change in the last years and steadily rises in interest. Here is everything you need to know about the social token!
Key Facts
UPCO2 is the world’s first carbon credit token that can be bought and held as an investment, as well as burnt to offset a carbon footprint. Each UPCO2 token is backed 1:1 by a Voluntary Carbon Unit on a leading registry, which represents a one-year tonne of carbon emissions averted.
Being an ERC20 token on the Ethereum Network, UPCO2 is fractional, which means you can invest as little, or as much, as you can afford to offset your carbon footprint or hold as a speculative investment and support the world’s rainforests. Most importantly, with one simple transaction, you’re taking a step towards a cleaner planet.
What is so interesting about it
The UPCO2 aims to become more than just another token. Carbon emission trading has been proposed by the EU as one highly effective solution in achieving the two-degree goal to stop global warming. Trading certificates has been proven economically feasible for waste products that have a slow but steady effect.
Now UPCO2 wants to bring certificate trading to a global scale. Commodity markets such as the international oil or gold market have been a part of global trading for a long time. With the rising scarcity of possible carbon emissions, it seems only reasonable to assume that carbon offsetting certificates could become the next digitalized commodity.
How the UPCO2 token works
After buying the token, you have different options:
- You can simply hold the token as an investment since the token price highly depends on the underlying supply and demand. This means if more people need credits to offset their carbon emission the token should be more demanded and a price increase will follow.
- You can also buy the token as an easy way of offsetting your own carbon emissions in a year by one tonne CO2.
- The token can also work as a sort of donation when you decide to burn it forever on the blockchain, which does not seem to be a common option.
Why buy the UPCO2 token
The investment case for the token is quite simple. Firms will need carbon credit tokens in the future that allow them to offset their emissions.
This will dramatically increase the current supply shortage even further, as new CO2 offsetting initiatives are difficult to scale. Hence, the International Monetary Fund and Morgan Stanley agree that carbon credits (such as the Universal Carbon token) will increase their value in 10 years exponentially.
Lack of liquidity
While the investment case and the overall goal of the token seem to be hard to argue with, there is some critique.
The token has now been live for 2 months and so far there have been less than 140 transactions recorded with 32 addresses currently holding the UPCO2 token. Transaction activity seems to be on a downward trend for the last month.
Restriction: These numbers are taken from Etherscan, which might not depict the complete reality of transactions. Since contract creations and other events are also included, actual token activity numbers are most likely much lower.
Conclusion
Many tokens lack a certain credibility factor, which is not the case for the Universal Carbon token. Both token creators and carbon credit projects are certified and well-known players in their industry, showing great efforts to maximize transparency and trust.
While illiquidity is almost always an issue at the beginning for new tokens, the UPCO2 token still aims to unlock the full potential of carbon emission trading and the investment will help mother earth at the same time!
Remarks
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Authors
Simon Peters is the Managing Director of DECUS Network. We at DECUS open the doors for asset managers to new uncorrelated & uncensored asset class. Diversify your portfolio and Make Your Legacy Unshakeable!
Leander Schmidt is the Content Marketing Manager at DECUS Network. His areas of interest include Ethereum smart contracts, distributed ledger technologies (DLTs) and decentralized finance (DeFi).
DECUS Network GmbH is a venture of BlockSize Capital.
