Nasdaq has launched a service designed to digitize the issuance, settlement, and custody of carbon credits, a move that aims to bring standardization and scalability to the burgeoning carbon market. The new technology is set to enhance liquidity by providing an institutional-grade infrastructure that supports the entire lifecycle of a carbon credit transaction, from issuance to auditability.
The exchange's initiative, which was unveiled today, leverages smart contract technology for secure transactions, catering to the needs of institutional investors. The solution is flexible, allowing for integration with existing financial systems or operating as an autonomous platform. It offers the choice between a centralized database or a private blockchain network, ensuring secure and transparent operations.
In a strategic move to bolster this technology, Nasdaq has partnered with Puro.earth, a coalescence that was announced on an unspecified date. This collaboration will apply Nasdaq's digital solution within the Puro Registry for CO2 Removal Certificates (CORCs). Puro.earth's Puro Standard, the first engineered carbon removal standard verified by independent third parties and in line with the Intergovernmental Panel on Climate Change (IPCC) definitions, will be modernized with Nasdaq’s technology. This ensures the accurate management of credit lifecycles and compliance with Article 6 of the Paris Agreement.
The partnership aims to provide comprehensive APIs for seamless market interaction, enhancing traceability and preventing double counting in carbon projects. This development signifies a significant step towards the standardization of a market that is crucial for global efforts to combat climate change.
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