I haven’t fully thought through the idea, but was opening up the idea for discussion.
I was reading about synthetic assets pegged to Bitcoin hash power and wondered could that be linked together with some kind of asset tied to carbon output and create a crypto Carbon Credits program since proof of work is getting a lot of hate for power consumption?
Carbon credits are making an asset related to a companies greenhouse gas emissions, so being a derived asset I thought synthetics might be able to do something similar.
It’s possible to create a synthetic iAsset pegged to Bitcoin hash power. It’s also possible to create an iAsset pegged to a publicly available statistic for carbon output.
Can you elaborate more on how a Carbon Credits program would work?
You can also explore potential integration with Toucan, which is a protocol that tokenized emitted carbon credit on chain ==> https://toucan.earth/
how would a synthetic carbon credit do any good? Unless it is ingerantly tied to actual carbon credits? Hypothetically something might be able to be developed with Veritree? I’m sure they are creating carbon credits out of the planting.
Synthetic carbon credits would only be useful if it was being used officially as the medium for a national carbon program. So I am imagining this in a scenario where Indigo and Cardano are being used by nation states.
I was curious if this was even technologically possible with synthetics and defiroose’s comment says that it should be possible.
The Green Assets Wallet – first blockchain for green bond impact data - SEI check this out for a blockchain implementation of green bonds. As people above mention, the only real way to have a proper carbon credits iAsset is to have massive stakeholder approval/use. Otherwise, it’s just a pegged asset with no utility, and thus little value.
An iAsset can be pegged to a price and that in of itself is valuable since it allows you to make trades based on what you think the future will bring. An iAsset however would need adoption beyond trading for it to work as a carbon credit.
Although it might not be viable in current situation but it is a worthy idea. May be 10 years from now and wee see this through.
There is a Cardano project called Cardashift that has a “Decentralised Carbon Market” on their road map. Maybe iAssets like the one you are describing would be traded on a platform like that?
As the iAsset can be pegged with real-world asset, I want to remind that there is the price of certified Carbon emission reduction available, and even can be traded. How about pegging with the price?
Can I as an end-user of the protocol make my own iAsset or can I only buy the ones you make?
How do you choose which assets to make.