Low carbon commodity company SCB has entered a partnership with Solid World DAO, the world’s first infrastructure platform for carbon credit pre-purchasing. Solid World DAO harnesses blockchain technology to tokenise carbon credit pre-purchase agreements to expand trading opportunities, improve transparency and reduce friction in the voluntary carbon market.
SCB Group says it pursuing a low carbon future. It works with the whole value chain of the voluntary carbon space, including helping to fund projects in developing countries. The group supports corporates and everyday users to shape their sustainability strategies while sourcing carbon solutions in line with their goals and requirements.
SCB also promotes the adoption of low carbon alternatives by reducing the frictional cost of low carbon practices. Working with clients and partners, it aims to create markets, develop hedging tools and provide price transparency.
Why blockchain technology matters to the carbon credits market
SCB said this week that it supports the enhanced trust that blockchain technology brings to carbon credits’ verified emissions reduction in the voluntary carbon market. The regenerative finance (ReFi) mechanism pioneered by Solid World DAO makes it easier to invest in projects that have not yet issued carbon credits which in nature-based solutions can take years to manifest.
“At SCB, we feel Solid World DAO is doing something important in making pre-purchase deals trustworthy, liquid and transparent in the voluntary carbon market,” explained Wassim Sahibi, Carbon & EACs Trader at SCB. “We see great potential in this mission and through this innovative partnership we are well placed to work together to achieve this goal.”
This innovation in voluntary carbon transactions will substantially reduce risk to the buyer of credits, encouraging greater engagement, trading and will ultimately enable more funds to be channelled to high value projects, the company said.
How will the DAO help to manage risk?
Risk is reduced through a rigorous due diligence process and higher levels of transparency afforded by blockchain, allowing buyers of credits to better assess ownership and value. SCB reckons the Solid World DAO proposition will be of great use for trading houses, hedge funds, and other institutions as it will make previously illiquid pre-purchased carbon credits liquid and leverageable. In turn, this supports appropriate pricing and guarantees that financing goes to premium projects developers with high additionality.
Improved engagement and trading will also allow SCB to support additional innovative projects that develop the ReFi ecosystem, ensuring the integrity of the entire process.
SCB have been successfully operating in the low carbon commodity markets for 15 years. They have a proven track record of participating in innovative solutions and are well respected in the crypto x carbon community for their openness and collaborative spirit.
“Their experience and advice can make sure our platform will be fair and transparent for all market participants,” said Solid World founder Stenver Jerkku. “We are looking forward to also collaborating with other brokers / traders as well on our mission to bring funding to quality projects.”
