Climatecoin, an Ethereum-based cryptocurrency, has teamed up with a carbon credit exchange to help in the fight against climate change. The move is likely to contribute to the formation of the world’s first blockchain-based platform for trading carbon credits.
Carbon emissions are causing devastation to our environment, and one method the world is trying to address this issue is via the use of carbon credits, an approach agreed upon by the majority of the world’s governments through an international convention known as the Kyoto Protocol.
The system’s concept is that everyone has a limit on the amount of emissions they may emit. If a country wishes to exceed its limit, it must buy carbon credits. Each of these carbon credits acts as a permission to emit a specified quantity of CO2; for example, one credit may equal one tonne of CO2 emissions.
The funds used to acquire carbon credits and offsets are donated to environmental programmes such as the development of renewable energy systems and the preservation of forests.