Carbon isn’t materially underpinning these organizations, but DAOs and other crypto-based collectives aggregate voice, influence, and marketing with basic blockchain-based infrastructure support. Organizations harness the power of ownership to collectively organize individuals to provide grants, investment, mindshare, marketing, and insight to stimulate https://www.xcritical.com/ the community and further drive IRL impact. Infrastructure tools are loosely defined as data products, protocols, and adjacent tooling that support carbon suppliers and core blockchains in distributing carbon to the application layer.

What are the Potential Benefits of Implementing ReFi?

The cement industry accounted for 8 percent of global CO2[cvii] and needs to adapt to alternative fuel sources such as biomass. The aviation sector collaborated what is regenerative finance on an international agreement to reduce carbon emissions known as Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)[ci] which permits carbon offsets trading via the global carbon market. The EU is regulating an increase in the amount of sustainable aviation fuel (SAF)[cii] usage. This interconnectedness implies that one company failing to govern cyber risk can have a negative impact on others and down the supply chain relationships. Both carbon and cybersecurity demonstrate similar characteristics in terms of negative externalities and the reason to include cyber risk quantification as part of the carbon market framework.

Beyond Borders with Blockchain: A Vision for Digital Transformation

Save Planet Earth[xci] is a cryptocurrency and has partnered with Phantasma[xcii], a blockchain that offers carbon neutral smart NFTs and uses the PCS registry standard. Tokenized carbon is a digital representation of real-world carbon credits on the blockchain and Toucan Carbon Bridge[lxxix] is being used to build the tokens. Early adopters on the demand side will hold tokenized carbon and help make net-zero claims based on retirements of on-chain carbon. Carbon will also become a yield-bearing financial instrument and interest earned on carbon credit deposits.

Intersection with Decentralized Finance

ReFi could also facilitate integration between environmental and social impact metrics and financial models, bridging the gap between economic outcomes and tangible sustainable efforts. By enhancing information sharing and implementing a comprehensive, transparently codified system of rules, ReFi enables the tokenization of nature as digital assets. This means translating the inherent value of resources into digital representations, like community currencies, regenerative non-fungible token collections, and social tokens.

What should you consider before starting a Regenerative Finance project?

The following guide to ReFi isn’t a vaporware pitch or a ploy to sell you a useless token. This ReFi guide’s goal is to drive awareness into how this niche, but fast-growing sector may develop some of the key infrastructure and applications needed to make a regenerative economy significantly more attractive, and drive positive climate action. These centralized ReFi approaches pave the way for companies to capture value from restoring earth’s natural resources.

The digital carbon market is the latest growth of intangible assets with opportunity over time to spawn an influential crypto currency. Valuing carbon assets on the balance sheet using International Financial Reporting Standards’ IAS 38[xvi] enables data asset exchange trading, giving enterprises the freedom to operate in economies in exchange for derisking their activities. This allows for prenegotiated free passage of open, unique development of new markets with recognition and valuation supported in tax schemes. At the intersection of sustainability, Moonbeam, and DeFi lies ReFi Hub, an innovative platform aiming to direct over $1 billion into environmental sustainability efforts by 2030 using blockchain technology. As a pioneering ReFi project, ReFi Hub is proving that blockchain technology can be a powerful catalyst for restoring the planet. The ReFi Hub team previously built CoralTribe, a project harnessing the power of NFT art to impact the environment and natural world while incentivizing holders with shared revenue.

Yes, we provide a certificate of completion to participants based on an assessment of your participation and understanding at the conclusion of the program. Move-to-Earn models (part of a broader Impact-to-Earn ecosystem) are in their infancy, but we’ve seen several apps like StepN and Sweatcoin gain a foothold (I’m sorry) in the market. The obvious use case is to take the tokenized carbon itself and send it directly to the existing buyers’ market (large enterprises). Blockchain technology can streamline the issuance and liquidity side of carbon and make it more equitable for all parties involved.

• A SourceMaterial [lix] investigation in 2023 reported that 90 percent of rainforest carbon[lx] sold in the past was worthless, which rekindled fears around voluntary carbon markets risks.
• Regenerative business, however, takes this a step further by actively improving the environment and society beyond their current state.
• ReFi development goes a step further by integrating sustainability and ethical considerations into financial systems.
• Savimbo has deliberately avoided many of the usual scientific quantification methods, such as identification of individuals, eDNA/scientific methods, ecosystem or habitat quantification and species richness metrics.
• These efforts not only help mitigate climate change but also enhance biodiversity and natural resilience.

The Malaysian government is considering a carbon tax for transformation in energy systems. The Vietnam Ministry of Natural Resources and Environment is establishing a national carbon registration system for all businesses and organisations generating carbon credits in 2023[cxiv]. Below we discuss some examples of ReFi projects employing different methodologies and digital solutions for project enhancement.

Devvio [cxix] is an advanced blockchain-based ESG platform generating carbon credits for corporate clients. ReFi leverages the principles of DeFi development to create transparent, decentralized financial ecosystems. These ecosystems facilitate the flow of capital into projects that restore natural resources, enhance biodiversity, and promote social equity.

Because wildfire poses a serious threat to climate change efforts, the use of causal and third-wave AI is needed to get the best accuracy in forecasted predictions. Individual events such as strong winds and drought conditions convey forces that increase the value of a future fire risk trend. When these individual events occur simultaneously as a risk structure, the increase in fire risk is far greater than the sum of the events. Causal knowledge is an understanding of the relationship between a cause and its effect using AI for the explanation.

With less than seven years to carbon neutrality to achieve the Paris Agreement goals, there needs to be a massive pivot in technology and capital to get things on track. Jurisdictions are introducing new carbon pricing instruments and these signals for climate mitigation are critical to driving investment. The UN considers carbon neutrality by 2050 the most urgent mission[cxxi] because of the severity and urgency of the climate issue. Although countries have committed to carbon neutrality, barriers exist at the corporate and multi-tier supply chain levels. Insurance guarantees are essential and there is a need to evaluate high-quality projects to warrant the cover. The carbon offset will become a crypto currency that is backed by physical assets, uses green crypto mining, and has reserve capabilities like Bitcoin.

Opportunities in Web3 and ReFi are often removed from the barriers traditionally presented by the world — from geographical boundaries to economies of scale. Decentralization, by design, also accelerates diversity and enables anyone interested to participate in the system, regardless of who they are and where they are from. Applications on a blockchain could be poorly designed or malicious — after all, access is open so anyone can create a decentralized application. Not many regulations are in place yet, so users of DeFi products need to carefully evaluate which services are safe to use and trustworthy. DeFi, or Decentralized Finance, is a new, accessible, and inclusive financial system that has emerged out of the Web3 movement.

The idea of the tragedy of the commons, coined by American ecologist Garret Hardin in 1968, refers to the concept of overconsumption of public goods. Public goods, such as clean air or fresh water, are those which are non-excludable and non-rivalrous. This respectively means that one person cannot exclude others from utilising the good and that their usage of this good does not preclude others’ use.