When talking about carbon markets, an environmentalist approach is strictly made; the planet is going through a significant environmental crisis due to the large amounts of polluting gases expelled into the ozone layer. The cryptocurrency Dogecoin has been in existence for a while. It started out as a spoof of Bitcoin but has since gained popularity among crypto fans.
This type of market is considered one of the economic instruments that contribute to weakening the emission of these greenhouse gases, which, if linked to blockchain technology that has so many uses, could optimize this type of market.
Climate change and the world economy
Climate changes worldwide have been generated spontaneously despite already known weather patterns and seasons in each geographical area; they have also been affected by the incidence of the productive and extractive processes of the various industries.
Most of the counterproductive effects on the environment are due to greenhouse gases in the atmosphere, the impact is global, not just a part of the planet, and that is why various strategies arise to counteract these damages.
The main actions are reflected in two international agreements focusing on reducing these damages and are known as the Kyoto Agreement and the Paris Agreement, developing in the first as a strategy to safeguard the environment’s carbon markets.
What are carbon markets?
After various environmental agreements, this concept of Carbon markets has emerged, considering them an alternative for reducing greenhouse gas emissions by countries, corporations, and individuals.
How this type of market operates is the same as any other traditional commercial market, only carbon bonds are traded through contracts, where each bond is equivalent to one ton of Carbon Dioxide, and the parties are responsible for paying and providing a service for the reduction of Greenhouse Gas ( GHG ) emissions.
These types of operations are linked to sustainable projects that emerging countries have endorsed.
Just as technology has given way to new opportunities that could represent the future of the various essential sectors of the world economy, be they financial, food, marketing, or services, the environment also evolves in applying friendly practices with the ecosystem.
The Blockchain for the management of carbon markets
The ability of the Blockchain to execute processes quickly and effectively is what has caught the attention of the carbon market, considering it a timely innovation in the management of objectives and operation of carbon markets.
The link between this technology and the carbon market is considered from the perspective that any person or interested party can participate in the carbon market, where access and analysis of the processes are available to everyone safely and reliably.
Through blockchain technology, users of the carbon market will be able to purchase said bonds directly, avoiding fraudulent transactions concerning the issuance of certificates.
However, the use of smart contracts makes decision-making much more secure; in addition to the buying and selling process, adding cryptocurrencies to all these elements . as digital financial instruments with which you can pay, such as the digital currency known as Climatecoin.
Carbon markets have been the victim of a great deal of criticism which could undoubtedly weaken them. Still, to date, no tool with a greater scope allows for minimizing the impact of industries on the environment.
Blockchain’s transparency is its greatest virtue.
There are a lot of benefits and innovations offered by the carbon market. Still, it has also been overshadowed by the lack of transparency in operations. That is when blockchain technology joins the team of developers to design attractive strategies where the brokers involved must be involved in the project.
Although we are facing a scenario that has not been exploited before, blockchain technology is essential to eliminate the fraud and corruption to which the carbon market is exposed.
Blockchain facilitates the creation of new products and services in this market. New market systems can be created based on direct person-to-person (P2P) or business-to-consumer (B2C) operations directly and without intermediaries.
Conclusion
The reinvention of the markets is increasingly considering the inclusion of Blockchain technology, where the security of the information of users and market participants makes operations effective and reliable.
