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article imageVeridium teams with IBM and Stellar on carbon credit blockchain

By Karen Graham     May 15, 2018 in Technology
Veridium Labs is collaborating with IBM to help transform the carbon credit market using IBM blockchain technology with the goal of making it easier for companies to offset their environmental footprints.
Veridium Labs Ltd, an Environmental FinTechn company incubated by EnVision Corporation. The company is built on the Stellar Blockchain and produces disruptive sustainability solutions for Fortune 500 companies.
Veridium's unique solution for carbon credits encompasses the entire process of carbon footprint accounting and offsetting relying on blockchain technology. Using IBM's expertise, Veridium plans to transform carbon credits into easily tradeable assets (called fungible assets).
Some coutnries like Marshall Islands  which has endured worsening storm surges due to global warming...
Some coutnries like Marshall Islands, which has endured worsening storm surges due to global warming, are at a higher risk of rising seas and wanted a stronger committment to reduce carbon dioxide emssions
GIFF JOHNSON, AFP/File
What is Carbon pricing?
Fossil fuels, including coal, oil, and natural gas, are used to generate electricity, power our vehicles, and heat our homes and businesses. Yet they all produce carbon dioxide, the leading cause of climate change. In most cases, the cost of climate change impacts, like public health and damage costs of heatwaves, flooding, heavy downpours, and droughts are borne by the tax-payers and individuals directly impacted.
The whole point of the carbon credits system is to put a price on the carbon emitted into the atmosphere in the hope that producers and consumers will look for ways to use technologies and products that generate less of it. At the present time, there are two ways to put a price on carbon.
With a cap-and-trade program, laws or regulations set up a limit or ‘cap’ on carbon emissions from particular sectors of the economy, such as the petroleum industry or power plants. Permits or allowances are issued, one for each set amount of carbon. For example, if carbon was set at 10,000 tons, a company might be given 10 permits, one for every 10,000 tons of carbon.
In this system, carbon dioxide releases are allowed, but companies that don't reach their cap can sell left-over credits to those who go over their cap. So the trading and auctioning off of these credits in the market determines the price of an allowance (also known as the carbon price).
With a carbon tax, laws or rules are enacted that set a fee per ton of carbon emissions from a sector. This means owners of carbon emissions sources will pay taxes equal to the per-ton fee times their total emissions. In this direct-leaning system, the rules or laws are set by governments and there is a great incentive for a corporation to lower their carbon emissions.
The EU Emissions Trading System puts a cap on the amount of carbon dioxide allowed to be emitted by ...
The EU Emissions Trading System puts a cap on the amount of carbon dioxide allowed to be emitted by large factories and other companies. 
DENIS CHARLET, AFP/File
Veridiums solution using blockchain technology
Veridium discovered that some carbon offset credits can be very complex, and this makes buying or selling them on the open exchanges difficult because there is no formula for calculating their true value. Veridium believes they can finally fix this problem with tokens and the blockchain.
This week, Veridium announced they would be working with IBM to sell carbon offset tokens on the Stellar blockchain. Stellar is basically, the digital ledger, while IBM will handle the all the trade activity of buying, selling and managing the tokens. Veridium has the job of setting up the systems infrastructure and coming up with the formula.
"Blockchain based digital assets, or tokens, enable innovative ways to buy and use the underlying carbon offset since they can move and settle swiftly across networks," IBM said of the project in a press release.
"Integrating the entire process of carbon accounting and offsetting into a digital token on a public, permissioned blockchain network can help make measuring environmental impact, transferring ownership rights, and redeeming the underlying carbon offset more efficient."
More about blockchain, Carbon credits, Veridium, Ibm, value chain
 
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