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Carbon offsets are claims of activities which reduce carbon emissions, such as investments in renewable energy generation, improved forestry and land management, circular economy and reuse, and carbon capture and sequestration.  Carbon offsets are either part of mandatory schemes, such as the European Emissions Trading Allowance, industry schemes, such as CORSIA, and voluntary purchases by primarily corporate buyers and some individuals.

Mandatory carbon trading regimes are often limited in scope and region, and in the past have suffered large swings in activity due to political shifts.  The European Emission Trading scheme, for example, was active until 2010.  

Therefore, to reach Paris Climate goals, a robust voluntary carbon offsets market is needed.  The voluntary carbon offsets market is currently a highly fragmented, illiquid market with poor transparency and questionable quality.  The goal of this project is to bring forward a blockchain-based solution which will allow greater transparency, price discovery, and ultimately higher quality.  Through interviews with key stakeholders, we will identify the key issues, fine tune a solution, and bring on initial participants to launch it.

Current Ecosystem

Carbon offsets are created by

  1. A developers invests in projects, such as renewable energy or forestry management
  2. Claims about the emissions reduction of the project is calculated under a methodology published by a verification body.  These methodologies are based on the CDM methodologies.
  3. The project is registered with a verification body.
  4. A Validation and Verification Bureau (VVB) validates the project.
  5. On an ongoing basis, the VVB reviews the data and independently verifies aspects of the project, to certify the amount of emissions reduced.
  6. The verified emissions reductions are sold as carbon offsets, through brokers or directly to buyers.

The Players

Verification Bodies:

  • Gold Standard - More focus on community and co-benefits
  • VERRA - largest, highest volume traded
  • Global Carbon Council - new standard body based in Qatar looking to issue first batch in July 2021
  • American Carbon Registry 
  • CAR
  • Woodlands Trust

Validation and Verification Bureaus

See for example Gold Standard’s approve auditors list


Major corporations such as Microsoft

CORSIA - eligibility criteria for airlines to purchase credits



Pricing References

Since the market trades directly or over-the-counter, most of the information is not available.  However, a few references are:


  • Very heterogeneous market with different project types (forestry, renewables, etc.) and different regions
  • Different offsets trade vastly differently, from under $1 to nearly $50 per ton, even though they’re all denominated in tons of CO2 emissions 
  • Lack of transparency in pricing
  • A lot of different registries makes it difficult for buyers to track
  • Risk of double selling, where the same project is listed on different registries and the offsets are sold several times
  • Buyers question the validity of the offsets 

Proposed Solution

A blockchain based platform to provide a central directory of voluntary offsets based on a decentralized architecture.  The decentralized permissioned architecture allows recognized participants around the world and in different functional roles (developers, brokers, buyers, verification bureaus, standards organizations) to contribute data about voluntary carbon offsets.  Built on a permissioned network such as Hyperledger Fabric, members of the network could contribute data about voluntary carbon offsets, including the projects details, quantity issued, background documentation, and any trades that occur.  Fabric is a high speed ledger, faster and with lower energy usage than public proof of work or even proof of stake ledgers.  We could use IPFS or another decentralized storage mechanism to store documentation of the offsets and use md5 to verify that documents have not been altered. 

The solution would be an open source code base which includes Fabric chain code, scripts to access the network, plus a basic web UI for demonstration purposes.  Initially the data could come from the Berkeley Carbon Trading Project of different offsets registries, so the schema would be based on their data as wellA proposed governance and incentive structure:

  • This decentralized network would be governed like an open source project. 
  • The initial members serve as the maintainers/committers who could add new members.  
  • Only members are able to read and write directly to the network.  
  • The maintainers will host the basic web UI as a publicly available resource.
  • Members could use their access rights to create their own UI, apps, or branded research services for their clients or users.    
  • If members do not actively contribute additional data or contribute incorrect data, they would be removed by the maintainers.
  • Initially the governance and validation of the data would be informal, but as the project grows, it could be formalized with a DAO voting scheme.

An incentive structure for contributions similar to the Multiple Listing Service for residential real estate would be based on:

  1. Upgraded usage of data from the directory to the contributions.  A verification process would be set up to validate the data from the participants.  For example, members could challenge listings and trades.  The challenged member would then need to prove them to a neutral DAO panel.  If the challenge is successful, the failing party would lose reputation tokens; if the challenge fails, the challenging party would lose reputation tokens.  Eventually if party has too few tokens it loses access to the directory.
  2. Public listing of offsets purchased by end user organizations looking to prove their purchases.
  3. Published leader boards of top dealers and purchasers, which would help their reputations.
  4. Listing service for sale of future offsets.   

This directory would not directly allow trading between participants.  It is for information purposes only.  However, even without trading, this directory could greatly enhance the voluntary offsets market place by:

  • Providing a price discovery service
  • Allow peer review of quality of offsets
  • Identify possible duplicate selling of projects


Ecosystem Analysis

The Case for Starting Your Project with an Ecosystem Map:

How to Get Ecosystem Buy-In:

Methodology Of Business Ecosystems Network Analysis: A Field Study In Telecom Italia Future Centre

BEAM: A framework for business ecosystem analysis and modeling:

Business ecosystem analysis framework:

The Delicate Balance of Making an Ecosystem Strategy Work:

Mapping and Strategising Across Business Ecosystems:


This project is part of the Documentation and Use Cases for Climate Action mentorship.  For updates on this project, see the Project Plan - Documentation and Use Cases for Climate Action.

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