Earlier today, IBM announced yet another partnership within the blockchain industry. Teaming up with Veridium Labs, they aim to tokenize a longstanding process. Veridium Labs is a self-described ‘environmental and social impact offset token’. Their token is blockchain based, and working with IBM, will build a platform allowing for the evolution of carbon offset credits.
Carbon credits are simple; either an individual or corporation will be tasked with determining how much pollution they are creating. They will then purchase a proportionate amount of carbon credits. The funding raised through these credits will then be used to support green initiatives throughout the world. These initiatives can range from planting trees, to developing green energy, and even cleaning our oceans. Unfortunately, the current process of carbon credits is questionable. It is a very difficult process to track ones pollution, record the data, and verify that funding is spent on the appropriate offsetting practices. In utilizing a blockchain, tailor built for the industry, an immutable ledger will provide inarguable levels of accountability.
This particular project will be built on top of the Stellar blockchain, utilizing smart-contracts to ensure transparency and accuracy. The token, named VERDE, will see its architecture and interface built by IBM, utilizing its partnership with Stellar. The tokens will then be given value by Veridium, and governed by their own proprietary protocols. In addition, the token will be backed by their sister company InfiniteEARTH and their own credits (InfiniteEARTH is currently utilized in the Paris Climate Accord for their methodology). Each of these companies operate under the umbrella of their mother company ‘EnVision Corporation’. Currently, the only credits available are single purchase units, which do not account for variations in credit value. They cannot easily be traded by a company once owned, as they are only able to do so over-the-counter (OTC). By tokenizing the process, this now allows for the proposed VERDE to easily be assigned varying values, and traded much like any other token. Backed by traditional carbon credits, each token will be able to be ‘charged’ and depleted like a battery. This will be based on market value, and determined via smart contracts.
The company does not only have their sights on large corporations, however. For the environmentally conscious individual, they are developing an easy to use app. This will allow a person to purchase VERDE tokens for either trade, or have a proportionate influence on which environmental projects the funding will be spent.
Although not for sale yet, we can expect to see these in late 2018. The process is ongoing as Veridium collaborates with various global bodies such as the United Nations to dial in an appropriate formula for determining token valuations.