Blockchain solutions for carbon markets are nearing maturity

Abstract

Carbon markets could hasten climate change mitigation by driving investment towards efficient decarbonization activities, but they face problems around trust, transparency, and uptake. Blockchain offers a foundational technology upon which new carbon markets can be built which address these shortcomings. This sector is still nascent, fragmented, and clouded by technology hype, all of which obscures objective judgement of its performance and suitability. Here, we survey the current blockchain ecosystem, identifying 39 organizations that are developing blockchain solutions for carbon markets across four use cases: emissions-trading schemes, voluntary carbon markets, Article 6 of the Paris Agreement, and the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). We develop and apply a technology readiness level (TRL) scale, and we find that most projects are still proofs of concept (TRL ≤ 3); however, one system has now reached maturity (TRL 9). Addressing the common barriers that face developers could allow more blockchain solutions to mature and potentially facilitate globalized carbon markets with greater efficiency, transparency, and accessibility.