World Bank's International Finance Corp Taps Blockchain For Carbon Offsets

ndtv.com:

International Finance Corp (IFC), a World Bank affiliate, told Reuters on Wednesday it is backing a blockchain-enabled platform to trade carbon offsets, aiming to attract more support from institutional investors for climate-friendly projects in emerging markets.

It is a bet that using blockchain - a digital database with information that can be publicly shared within a large decentralised network - will boost the use of carbon offsets to a greater extent than more traditional methods.

These credits are used by companies and organisations to offset emissions when accounting for their carbon footprint. They are backed by projects that compensate for emissions, such as tree planting or creating solar and wind power.

Several financial technology firms have sprung up over the last year to turn carbon offsets into digital tokens, yet the market has struggled to gain traction with companies and institutional investors amid concerns about the origin and environmental benefits of some of the traded credits. Blockchain technology has also been criticised by environmentalists as being too energy intensive.

Verra, operator of the world's largest registry of carbon credits, has said it will not allow its retired carbon offsets to be tokenised, and has announced a consultation on the tokenisation of its credits.

An IFC spokesperson told Reuters it would only source, tokenise and sell unused credits from an established registry that pass its additional quality checks.

The IFC has partnered with sustainability finance company Aspiration, blockchain technology firm Chia Network and biodiversity investor Cultivo to launch the Carbon Opportunities Fund, which will provide the carbon offsets on blockchain.

Seeded with $10 million as a