Laying the backdrop: Carbon assets, a new commodity
Before going through the discussion of digitizing carbon assets, let us take a step back to explain how this new commodity came about.
In 1997, an agreement was made under the United Nations Framework Convention on Climate Change (UNFCCC) that called the commitment of countries to reduce their emissions of carbon dioxide and five other greenhouse gases (GHG), or engage in emissions trading if they maintain or increase emissions of these gases. This agreement is called the Kyoto Protocol.
Countries that have committed to the Kyoto Protocol have accepted the set targets for limiting or reducing emissions. One feature of this landmark agreement, as set out in Article 17 of the Kyoto Protocol, is to allow countries to engage in emissions trading. Emissions trading is an economic activity in which countries that have emission units to spare, or emissions permitted them but not “used,” trades their excess capacity to countries that are over their emission targets.
Thus, a new commodity was created in the form of emission reductions or removals. Since carbon dioxide is the principal greenhouse gas, people speak simply of trading in carbon. Carbon is now tracked and traded like any other commodity.
These emission excesses are called carbon assets. These are economic “assets” that represent the excess units of greenhouse gas emissions generated by a country or a project. Carbon credits such as offsets, certified emissions reductions, and allowances are considered to be carbon assets.
Into the spotlight: Xarbon, bringing sustainability through technology
With carbon market and carbon trading at the backdrop, Xarbon emerges. Pronounced as “kɑrbon,” it is a sustainable technology company that partakes in various sustainability projects. Approximately, Xarbon has reduced about 200 million tons of carbon from the atmosphere and has protected over 500 thousand hectares of rainforest.
Co-Founder Jeffery Liu answers how Xarbon can benefit the NEM Community
Currently, most of their work as a sustainability company is protecting various areas of the Papua New Guinea rainforest from any form of degradation. Because these rainforests are like carbon sinks, which is a natural reservoir that accumulates and stores carbon-containing chemical compounds, Xarbon was able to obtain significant amount of carbon assets.
Instead of selling these assets directly to institutional polluters or buyers in the market, they hold them in the company’s reserves. The rationale behind this is to digitize these assets into the NEM blockchain to increases the transparency, efficiency, and liquidity of carbon markets.
Xarbon is committed to the sustainability game. In an interview with Jeffery Liu, Xarbon’s Co-Founder and COO, he is clear about Xarbon’s goals:
“In general, I would say that in 2018 and by early 2019, we have three main objectives. First is to obtain rights to 500 million tons of registrable carbon dioxide. Right now we have 200 million tons. We want to increase this amount to 500 million tons. The second milestone we aim for in the next six months is for the daily local trading volumes to increase to US$50 million. Finally, it is for Xarbon Sustainability Limited to actually partner with at least ten multinational companies to create carbon neutral products or services.”
Indeed, they are taking the spotlight by bringing sustainability through technology.
Standing on what stage? NEM, the perfect platform
As already mentioned, Xarbon digitizes its registrable carbon reductions by leveraging on the NEM blockchain. NEM, an open and decentralized information system that is built upon a blockchain architecture that features transparent and tamper-proof properties, is an ideal platform for Xarbon. The NEM blockchain also makes the integration of Xarbon very simple for any third party that wishes to utilize Xarbon in their system.
When asked why they chose NEM as a platform, Mr. Liu answered:
“When I was deciding on which platform to build our digitized Xarbon units, I was choosing between the obvious ERC20 and NEM mosaics. There were also other options such as Bitshares and Waves. There are several reasons we decided to use NEM in the end. One was, of course, the ease of use. We required specific and very technical features. For example, we needed a blockchain that will allow us to create digitized assets with certain amounts of decimal points. Not many platforms can do that. This, along with a range of reasons, is why we chose NEM. Mainly, I would say that it fits the functionalities that our digitized Xarbon asset needed, including smaller technical reasons.”
Certainly, NEM is the perfect platform because of specific technical and practical functionalities.
All in all, the demand for this new commodity and the goals of sustainability and technology have converged in this partnership between Xarbon and NEM. But what is more important to realize in all these is this: beyond the digitalization of the carbon assets, there is a reality, and perhaps a hope, of a cleaner and a more sustainable world. Who benefits? All of us.
Xarbon ($OCO) 2D Explainer Video
You might also want to check their bounty program:
Xarbon Sustainability Limited (referred to as "XSL") is a sustainability technology company that is registered in Hong Kong and is governed by the laws of Hong Kong. XSL's core management team constitute of members that control one of the two dozen afore-mentioned account with the United Nations. This account allows us to propose forestry projects to the UNFCCC for various carbon reduction units.
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