IBM, International Business Machines has made moves to issue its first crypto token on a public Blockchain.
The Verde tokens were developed in collaboration with Veridium Labs Ltd, a carbon credits startup. They will be issued on Stellar Blockchain and were built to help companies offset their pollution damages by supporting an area in the Indonesian rainforest.
Is it Sustainable?
Even though these carbon credits are not new, the whole process of tracking pollution by a company, assuring that the funds were used in replenishing the environment is difficult and time-consuming.
This process was moved to the Blockchain where it can be easily audited. The credits are also tokenized in the same way bitcoin tokenizes its monetary value. Jared Klee, the company’s new Blockchain offering manager, believes that this could open up doors to a vibrant market.
He stated that the company was creating a fungible digital asset which has the main goal of creating a market for people to buy, sell, trade and also redeem for credits. Klee believes that having a liquid market opens up a world of possibilities.
How it works
The carbon credit token called Verde is built on the public Stellar Blockchain as well as through a series of smart contracts. These contracts follow the complete process of accounting so the company can track its carbon emission and offset the pollution.
Kless also stated that the public permissioned model enables Veridium and IBM to build a market for buying and selling tokenized carbon credits which will be limited to various participants in accordance with the regulatory requirements. The company manages up to nine nodes on Stellar Blockchain to facilitate the permissioning while making use of Stellar’s public Blockchain.
This system helps create some stability for the Stellar network while allowing IBM to work with Veridium.