The current carbon credit system has come under heavy criticism for potential conflicts of interest and transparency shortfalls and is the subject of an independent review.
He described the market as immature and defined by “often fuzzy carbon credits and fairly clunky ways of transacting – and yet we are looking to move to a world that is enabled by digitised tokens and decentralised finance.”
He said ANZ believed an exchange using “tokenised” carbon credits (digitised contracts exchanged via blockchain) will provide the best chance to create an efficient, liquid global market for emitters and investors.
“Our ability to tokenise carbon credits and offer a digital means of settlement with our stablecoin is a great example of how we think we can participate in the transition and help accelerate it,” he said.
ANZ Chairman Paul O’Sullivan: “The adoption of a highly efficient and secure infrastructure, we believe, will accelerate the scaling and credibility of [carbon] marketplaces.” Oscar Colman
ANZ is already experimenting with the new infrastructure. In June, private investor Victor Smorgon Group used A$DC to purchase Australian Carbon Credit Units (ACCUs) that had been “tokenised” by BetaCarbon, a carbon trading platform, to create digital security tokens known as BCAUs.
Mr O’Sullivan said NFTs could be used to create a secure representation of a carbon offset; for example, codifying where the credit come from and results, which will also assist secondary market trading of the new securities.
“One of the key challenges looking at carbon offsets is getting confidence around provenance, whether they are genuine and whether they will be delivered,” he said. “We believe these challenges can be mitigated by verifying and codifying project-specific credentials using non-fungible tokens, which addresses many of the concerns around greenwashing.”
Wendy Mackay, managing director of Pollination, told the event that creating liquid markets using…
