Several development finance platforms and institutions are joining forces to launch the Carbon Opportunities Fund. This mechanism aims to issue carbon credits in the form of cryptographic tokens.
The use of blockchain is becoming more widespread and is opening up to carbon credits. This is now possible thanks to a new initiative by the International Finance Corporation (IFC), Cultivo, Aspiration and Chia Network. These platforms and development finance companies are launching the Carbon Opportunities Fund. This mechanism aims to raise capital globally for a model that obtains, tokenises and sells “high-quality verified” carbon credits.
Through this initiative, the IFC is strengthening its position in the global carbon credit market. According to the World Bank Group’s private sector financing arm, the new fund will also aim to catalyse voluntary carbon markets and expand access to finance for nature-based projects certified by leading international standards bodies.
Using the blockchain
Cultivo and Aspiration will be central to this global initiative. For example, Cultivo, a climate-focused fintech, will use its data-driven technologies to identify projects that produce “high-quality” carbon credits on a recurring basis. For its part, sustainability platform Aspiration will advise on the selection of carbon credit projects and investments for the Carbon Opportunities Fund.
“When the fund’s carbon credits are tokenised, they will be tracked by the World Bank’s climate platform, which has been launched on the Chia public blockchain, as the fundamental architecture for building market confidence by improving transparency and ensuring the integrity of global carbon trading,” says the IFC.
The Carbon Opportunities Fund is therefore promoting the implementation of nature-based solutions. According to Paulo de Bolle, Senior Global Director of the Financial Institutions Group at the IFC. These sustainable solutions can provide up to 40% of the carbon dioxide (CO2) removal needed to address the climate crisis. “This new framework that will use new blockchain technologies is an innovative way for capital markets to fully engage in carbon trading in a transparent, secure, fair and beneficial way,” says Paulo de Bolle.
Jean Marie Takouleu