Market Inefficiencies Strike Again!

October 22, 2022

Market Inefficiencies Strike Again!

$2.6 billion is a lot of money to leave on the table - but as the VCM grows, so do the lost opportunities. 

On the plus side, everyone from musicians to sovereign nations are still jumping into the VCM with both feet.

Read on to find out more.

The Rise of Sovereign Credits

Companies pledge net-zero, then purchase offsets. Individuals do the same. But what about countries? Finding the money to develop large-scale, environmentally-friendly projects can be a challenge.

That’s where sovereign credits come in. Using the REDD+ framework, countries can sell carbon credits directly and use the funds to preserve vast natural carbon sinks.

The scheme is especially valuable for rainforest countries. Sovereign credits work slightly differently from your average VCM offset, but they’re drawing increasing attention from major corporations like Deutsche Bank.

The VCM Could Be $2.6 Billion Bigger

That’s the estimated cost of verification delays for carbon offsets on the VCM. Thallo, a blockchain-based VCM exchange, came up with the estimate after analyzing key bottlenecks in the carbon offset process.

They found three areas of glaring inefficiency:

 

Verification delays

Limited early funding

Over-reliance on intermediaries

Thallo has a solution: use blockchain technology to democratize the entire process.

Will it catch on? Or will the inefficiencies grow alongside the VCM?

BlackRock Makes A Transition

Transition Capital is the newest unit in the world’s largest asset management firm, and it has just one purpose - to help investors transition to a low-carbon economy. 

The idea is about more than just helping the environment. It’s about aiding investors in a world of net-zero and sustainable solutions. 

And when those ideas are backed by an asset management firm that handles over $8 trillion, you know they have legs.

Musicians Go Net-Zero

Concerts: great to listen to, not-so-great for the environment. They encourage travel, congestion, and single-use everything.

Musicians know this, which is why a number of them are leading the push for individuals to achieve net zero. And beyond the individual level, major artists are considering how to put on carbon-neutral tours and shows, mostly by using offsets.

The push marks the latest expansion of the VCM from a corporate-dominated initiative to one that directly impacts society and individuals.

Carbon Fact of the Week

With the global population set to grow by 1 billion in the next 15 years, there is going to be an increased demand for food.

Here are the top 3 and bottom 3 foods, based on the CO2e per kg of food produced.

Highest Carbon Footprint:

#1 Beef - 60kg of CO2e

#2 Lamb - 24kg of CO2e

#3 Cheese - 21kg ofCO2e

Lowest Carbon Footprint:

#1 Nuts - 0.3kg of CO2e

#2 Citrus Fruit - 0.3kg of CO2e

#3 Apples - 0.4kg of CO2e

Source: https://carboncredits.com/