Blockchain continues to be a hot topic and it’s being increasingly used by businesses as a secure way to make transactions and transfers securely and cost-effectively. As the technology develops, and new applications and platforms arise, there is growing awareness about the implications that blockchain can have for the planet.
While blockchain has taken quite a bit of heat on the sustainability front – particularly for its energy-intensive nature due to its “proof-of-work” mechanism – it does have the potential to positively impact our planet. If harnessed correctly, blockchain can actually enable a shift to cleaner and more resource-preserving, decentralized solutions. In the process, it can unlock natural capital and empower communities.
Across Europe, we have noticed various developments using the power of blockchain to actually heal and benefit the earth – and yes, startups are the ones leading the way. Ethereum has adopted a “proof-of-stake” mechanism that uses less energy to confirm transactions. Polygon, a Layer 2 blockchain platform that is scaling Ethereum, is on a mission to be one of the most energy-efficient blockchains – they have pledged to set aside $20 million for sustainability projects.
Innovative applications of blockchain technology are arising in every industry from financial services to the creative industries. Virtually no industry has been left behind in the blockchain craze, so, it’s no surprise that solutions that benefit our climate and sustainability have not been left out of the hype.
How blockchain can benefit the planet
We found that most climate tech startups using blockchain are focused on optimising trading voluntary carbon markets. As more companies are pledging to work towards net zero, there is more participation in the carbon markets than ever before. By 2030, the market for carbon credits could be worth at least $50 billion.
Traditionally, trading in the carbon markets lacks transparency and is inefficient. To trade carbon credits and carbon offsets, a broker is involved in the transaction and charges a sizeable margin. A few other concerns that exist in the traditional carbon market are the high risk of greenwashing and double-counting carbon credits due to a lack of reliable data. By moving carbon markets on-chain, it creates more transparency as data is immutable. Aside from blockchain being applied to innovate carbon markets to benefit sustainability, startups are also using blockchain in the circular economy and issuing sustainable assets that can be used as collateral or NFTs.
Here are some startups from across Europe using the blockchain for good, bringing about more transparency and authentic sustainability.
Single.Earth – Single.Earth’s mission is to help preserve existing systems by making conservation profitable for landowners of all sizes. They are working on making saving forests as profitable as cutting them down. On their platform, landowners are awarded a token for the equivalent of 100kg of CO2 captured by their forests, wetlands, or other natural resources based on the ecological value of their land. They are based in Tallinn, Estonia and launched in 2019. To date, they have raised €8.1 million and most recently raised their seed round led by EQT with participation from Icebreaker.VC. Founder and CEO, Merit Valdsalu spoke at this year’s EU-Startups Summit and shared some fascinating insights on how they are tokenizing the environment, and creating a sustainable nature-backed economy.
JustCarbon – JustCarbon is working on bringing blockchain to carbon credits markets. They developed a blockchain-based marketplace to trade carbon credits that helps to reduce costs and remove middlemen – creating a nature-based carbon removal marketplace. Users can purchase JustCarbon tokens, which are called JustCarbon Removal Units (referred to as JCRs). 1 JCR = 1 tonne of sequestered carbon that is certified against the platform’s governance rules, which is managed by JustCarbon’s DAO. Holders of the JustCarbon Governance token control the DAO. JustCarbon’s team is comprised of climate and blockchain experts based in London.
Senken – Senken is the world’s first open marketplace where anyone can compare, buy, trade, and retire on-chain carbon credits. It makes voluntary carbon offsetting as user-friendly and easy as possible – making the market accessible. They are on a mission to solve the credibility and transparency problem of the voluntary carbon market as their tokens are stored in a distributed database that is decentralised and immutable. Their platform also provides detailed information about each climate project to help users make an informed decision when selecting a project including information about their carbon rating (powered by BeZero) and the vintage of a carbon offset. Senken was founded in Berlin in 2022.
Twig – Twig is branding itself as the “bank of things” and rooted in circular economy principles. They are empowering consumers to unlock value from things that they have and no longer want where they can trade in or sell their items for instant cash. Twig is taking strides into Web3 through the development of its Web3 green payment infrastructure. They want to go beyond helping consumers realise the value in their physical goods in exchange for fiat currency and enable consumers to buy cryptocurrencies and NFTs and trading-in their items. Founded in 2021, London-based Twig has so far raised a total of €41.4 million and landed B-Corp certification.
Coorest – Coorest is a decentralised marketplace that gives both institutional and individual investors the opportunity to offset their CO2 footprint. The aim is to bridge the gap between the real and the digital world, harnessing tech for the planet. Coorest sells NFTs, which they call NFTrees which is a project of planting real-world trees to offset excess CO2. When the tree is planted, the owner of the NFTRee collects tokens equivalent to the amount of CO2 sequestered. The tokens can be used or sold as carbon compensation. Coorest supports agriculture by buying previously unused land and employing local farmers to work on the land. The Estonian startup was founded in 2021.
Toucan Protocol – Zug-based Toucan is building web3 infrastructure for a regenerative economy. They have created a pioneering globally accessible and liquid market for voluntary carbon credits. With their technology, they are enabling carbon credits to be used in a variety of use cases including NFTs, digital assets, and collateral. ReFi — or regenerative finance — is a niche within web3 that leverages blockchain technology to tackle big environmental issues – it can be used for initiatives like ocean conservation, impact apps, regenerative community development and more. Toucan launched in October 2021.
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