Newsletter  #5 - Carbon Off-set

Newsletter #5 - Carbon Off-set

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Forests, where oxygen, the essential source of life, is produced, are among the world's most crucial ecosystems. Three centuries ago, more than half of all habitable land on Earth was covered by forests.Today, forests only cover 31% of the global land area, and only half of that remains undamaged. The main driving forces behind deforestation are:

  • agricultural expansion
  • mining practices
  • excessive timber production
  • and increased demand for fossil fuels...

Deforestation is at the core of many challenges we face today, such as climate change, droughts, extreme weather events, pollution, poverty, and the spread of diseases. Taking a step back,

it is evident that the linear economic model widely used today, is the underlying cause of deforestation. This model involves processing natural resources

into products, consuming them, and disposing of them. However, hows sustainable is this model?

Regenerative finance, ReFi, uses money as a tool to change the narrative underlying our current economic model and address systemic issues. ReFi advocates for using capital to ensure the health and fairness of social and environmental systems. It believes in the necessity of an economic system that prioritizes regeneration to solve the ecosystem crises, such as the planetary climate crisis, biodiversity loss, and inequalities between countries and people.

To combat the climate crisis, a warming planet, and increasing greenhouse gas emissions, both collective and individual measures are necessary. While actions at the government and corporate levels are essential for scaling change, individuals can also

take steps. But, what can we do about emissions from activities for which climate-friendly alternatives are not yet widely available, such as air travel? The answer may lie in carbon off-sets.

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By performing  carbon off-set, emissions by supporting sustainable environmental projects is one of the easiest and most effective ways for individuals and sectors where climate-friendly alternatives are scarce to combat the climate crisis.

What is Carbon Footprint?

A carbon footprint is the total amount of direct and indirect emissions generated by the activities of an individual or organization.

The Environmental Protection Agency (EPA) and many other websites offer free carbon footprint calculators that you can use to calculate your carbon footprint.. You can also use these calculators to calculate your carbon footprint!

What is Carbon Off-Setting?

Carbon off-setting is a mechanism that ensures the compensation of carbon emissions by preventing their occurrence elsewhere. It also contributes to Sustainable Development Goals, such as low energy consumption and improved air and water quality.

Carbon off-set projects involve purchasing credits from projects designed to reduce greenhouse gas emissions and help mitigate the planet's warming. By purchasing these credits, individuals support actions that increase the retention of carbon dioxide in long-term carbon reservoirs like trees, soils, and wetlands, or actions that reduce greenhouse gas emissions from sources like landfills, farms, and coal mines.

Organizations and individuals can voluntarily or mandatorily engage in carbon off-setting.

The concept is simple: carbon off-sets represent a metric ton of CO2 equivalent eliminated by a specific action or project, and a carbon credit is equal to one ton of carbon dioxide. The math behind it is theoretically simple, but we still have a long way to go to make accurate calculations and implement them in the real world.

Can Carbon Off-Setting Combat the Climate Crisis?

While carbon off-setting plays an important role in addressing climate change, it is only one of many climate solutions needed to save the climate. Rather than relying solely on a system where harmful gas emissions still occur but are balanced out, we should prioritize more effective approaches at a larger scale, such as reducing, eliminating, and reversing harmful gas emissions.

Examples of Carbon Off-Setting:

  • Forestry: Tree-planting projects Agriculture: Innovative agricultural techniques
  • Aviation: Approaches that optimize flight routes with AI
  • Renewable Energy: Projects aiming to replace fossil fuel usage with clean and renewable energy, such as wind farms
  • Water Management Innovations in the physical and chemical treatment
  • Energy Efficiency: Actions to improve infrastructure efficiency
  • Impact Tokens: Projects using blockchain technology for positive environmental and social impact
  • Carbon NFTs: Turning carbon off-set into NFT

Carbon Off-Set and ReFi:

With the rapid rise of blockchain technology and the increasing demand from users, green investments are now becoming suitable for blockchain. With various protocols and impact tokens, actions that care about the planet are now possible.

In recent years, we have seen the emergence of a new carbon market based on the tokenization of voluntary carbon credits. This system is a new, decentralized approach to growing the carbon market and has seen very rapid growth since its inception. The reasons for this growth are obvious: Anyone with access to the crypto currency world can buy and sell tokenized carbon credits on the fly without opening a new account or needing additional KYC checks. So, given the growing number of crypto users, the growth potential of the carbon credit consumer market is high.

Blockchain could, in theory, help to calculate how much carbon off-set will eliminate by linking off-sets to blockchain-based cryptocurrencies or tokens, and then verify that the carbon has been removed. While tokens help encourage validation, tokenizing off-set projects can also provide accurate measurement.

Examples of Blockchain Projects:

  • Toucan Protocol: The goal of the Toucan Protocol is to convert CO2 certificates for voluntary carbon off-sets from trusted sources into corresponding tokens on the Polygon blockchain. With blockchain, he plans to make the carbon market more accessible and attractive.
  • MOSS: Rooted in South America and dedicated to the protection of the Amazon rainforest, MOSS stands out with its MCO2 token and Amazon Forest NFT tools.
  • Menthol Protocol: The world's first multi-chain decentralized sustainability protocol that balances the emissions of users or dApp transactions from around the globe with verified renewable energy and carbon credits.
  • KlimaDAO: KlimaDAO, self-proclaimed "black hole for CO2," is a Decentralized Autonomous Organization (DAO) built on the Polygon network, which is more energy-efficient.

Why is it important to find the right off-set program, and what should be considered?

To benefit the planet, a carbon off-set project must truly impact emissions in the atmosphere. Therefore, in the project:

Determining which types of projects are suitable and how to measure greenhouse gas emission reductions is typically governed by a clearly defined set of standardized conditions known as a "protocol."

Compliance with these requirements should be independently verifiable by a third party, and the project should be fully transparent in terms of implementation and reporting.

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ReFi Turkiye Podcast 🎧️

🌱 Within the scope of ReFi Turkiye program, the 6th episode of our podcast series, which we made with the pioneers who think and build on Web3, is online!

You can listen to episodes about the intersection of web technologies and the impact ecosystem on Spotify, Apple Podcasts, Soundcloud and Spreaker. Also, you can get NFTs that we've made specifically for the podcast episodes with the code you'll hear in episodes!

In episode 6, we welcome Han Tüzün, one of the significant actors of the global Web3 ecosystem, who has made developments and investments in this field with the slogan "We are building the inevitable future". You can listen to the episode where we delve into both these efforts and the concept of ReFi in detail with Tüzün here and read the episode notes here.

Film Suggestion

"The Blockchain and Us" is a documentary directed by Manuel Stagars that focuses on the technology underlying Bitcoin, known as Blockchain . It focuses on the interviews with experts in the finance and technology sectors, exploring how financial technology will shape the future.