The Bitcoin network is a massive consumer of electricity, leaving a substantial carbon footprint. Research estimates that the electricity used on the network produces annual carbon emissions of about 32 MtCO2. This means the Bitcoin network emits the same amount of carbon dioxide as Denmark.
Moreover, new studies show that the network generates as much e-waste as the country of Luxembourg. Unfortunately, the continuous growth of the Bitcoin network will intensify its environmental impact.
Although not all blockchains consume as much energy as Bitcoin’s, the industry needs to make great efforts to be more environmentally conscious. That is why projects like CRI are so crucial in the crypto space. This guide article will look into this new company and how carbon credits work.
What Is CRI?
Carbon Reduction Initiative (CRI) has created the world’s first carbon credit generating blockchain. The company is inherently about offsetting the carbon footprint of cryptocurrencies like Bitcoin and having a significantly beneficial environmental impact.
The initiative achieves this by implementing a low energy decentralized masternode blockchain. The blockchain used is carbon neutral and will be the world’s first decentralized network to produce carbon credits.
Furthermore, these credits will be created using a proprietary cryptocurrency carbon credit methodology certified by Verra (Verified Carbon Standard), the world leader in the voluntary GHG program.
Moreover, it will be the first blockchain that can generate carbon offsets to counter the carbon footprint of Bitcoin directly. CRI is looking forward to pioneering this methodology so that other cryptocurrencies can also achieve zero net carbon emissions.
The network will have a native masternode currency called the Carbon Reduction Initiative Coin (CARI). CARI, a currency based on PIVX, will be used on the carbon-neutral platform for transaction purposes. CRI is working within the existing system in hopes of being a model for eco-friendly digital transactions. It aims to pioneer the groundbreaking use of low energy, carbon credit producing blockchains in the industry.
What Are Carbon Credits?
Carbon credits are tradable certificates or permits representing the saving of a certain amount of carbon dioxide or other greenhouse gases (GHG), normally a tonne. A permit can then be traded to another company and allows it to emit a mass equal to one tonne of carbon dioxide and still meet its carbon cap. Carbon credits are market mechanisms set by the government or regulatory authorities to mitigate GHG emissions. The regulatory authorities set caps on GHG emissions that companies have to adhere to, but some can’t perform the immediate reduction of emissions.
Therefore, to avoid being fined for exceeding the emissions cap, these companies buy more carbon credits from others. The sellers usually have achieved carbon offset and are under the set cap.
This buying and selling of carbon credits have led to the emergence of carbon trading.
The goal is to reduce the emission of GHG by providing economic incentives.
Types of Carbon Credits
There are two main types of carbon credits:
- Voluntary Emission Reduction (VER): a type of carbon offset exchanged for carbon credits in the over-the-counter market or voluntary market
- Certified Emission Reduction (CER): a type of emission unit created through a regulatory framework to offset a project emission
Whereas CERs are regulated through a third-party certifying body, VERs aren’t regulated.
Trading Carbon Credits
There are varied sales points for carbon credits, but they all fall under private or public markets and are open to international trade. There are currently five exchanges specializing in carbon trading: European Climate Exchange, European Energy Exchange, NASDAQ OMX Commodities Europe Exchange, PowerNext, and Commodities Exchange Bratislava. The carbon credit prices get driven by supply and demand. However, CERs are the only viable products that get used as investments by a trader. The certification of CRI’s carbon credit, therefore, makes them a smart investment.
CRI Projected Impact
The company is committed to introducing zero carbon, eco-friendly blockchain, and subsequent transactions to the industry. This move is a big step to counter the carbon footprint of Bitcoin and other Proof-of-Work cryptocurrencies. The adoption of carbon credit generating blockchains will allocate significant revenue for investors on the platform.
Furthermore, the industry will have an injection of cryptocurrencies with low carbon intensity but are secure, decentralized, and trustless. The eco-friendly aspect of these cryptocurrencies will attract a new niche of environmentally conscious investors and users.
CRI has further plans to certify its carbon credit through a world-renowned carbon credit issuing body. This plan will further secure the legitimacy of the project and give the carbon credits a step up. The company is ready for other cryptocurrencies to adopt its methodology and is confident in having a first-mover advantage.
With the world’s first carbon credit generating blockchain, CRI has managed to grab a potentially rewarding project. The company still has a significant amount of progress and development to make, but its unique idea will gain investors in no time.