Indonesia weighs blockchainpowered carbon trading scheme

News Summary

  • The mechanism incentivizes carbon emitters to be less polluting or they’d need to buy from those with excess carbon credits to offset their carbon footprint.
  • One of the buzziest projects is Toucan, which started out late last year by bridging credits issued by Verra, the carbon trading industry’s standard bearer, onto the blockchain and “retiring” the credits as tradable tokens.
  • In May, Verra banned the conversion of retired credits into cryptocurrencies “on the basis that the act of retirement is widely understood to refer to the consumption of the credit’s environmental benefit.”The backlash of Toucan hasn’t stopped countries from embracing blockchain carbon trading.
  • Startups that work to tokenize carbon credits have soared in popularity in the past year as they promise to entice more investors into the world of carbon exchange.
  • As of July, 46 countries are pricing emissions through carbon taxes or emissions trading schemes (ETS), according to the International Monetary Fund.“The Indonesian government has recognized the vital role that the financial services industry can play in strengthening the country’s sustainability commitments.
  • IDX is currently preparing for the possibility of becoming a carbon exchange in Indonesia and started discussions with several parties to deepen our knowledge,” says Jeffrey Hendrik, director of business development at IDX, in a statement.Carbon trading isn’t a panacea for climate change.
Indonesia wants to direct the blockchain craze toward greener use. The Indonesia Stock Exchange (IDX) has signed a memorandum of understanding with Metaverse Green Exchange (MVGX), a Singaporean star [+3587 chars]