The CORC (CO2 Removal Certificate) token is a carbon credit of the Puro.Earth standard. The Biochar carbon token (CHAR) represents CORC on the blockchain as a result of a two-way bridge organized by the Toucan protocol. Detailed information on the tokenization procedure of carbon credits and the operation scheme of one-way and two-way bridges can be found via the link.
As of the writing of this material, there are 1,666 CHAR tokens in circulation, priced at $162.49, from five climate projects associated with biochar production.
Biochar climate projects are initiatives aimed at using biochar, a product derived from organic materials through heating in low-oxygen conditions, to combat climate change.
Biochar possesses numerous properties that make it a valuable tool in the fight against climate change:
- Carbon Sequestration: Biochar can retain a significant amount of carbon for an extended period, helping to remove it from the atmosphere.
- Soil Fertility Enhancement: Biochar improves soil structure, increases its water retention capacity, and nutrient availability for plants, leading to higher yields.
- Greenhouse Gas Emission Reduction: Biochar can replace fossil fuels in certain industrial processes, leading to reduced greenhouse gas emissions.
- Sustainable Energy Production: Biochar can be used to produce bioenergy, a cleaner and renewable alternative to fossil fuels.
The Toucan protocol website provides access to the project documentation of all CORC-issuing climate projects.
It is essential to remember that CHAR is a pool of carbon credits from various climate projects, and CHAR tokens represent participation in this pool by providing tokenized carbon credits. To offset a carbon footprint, the initially provided pool token TCO2 must be obtained. A pool health adjustment is charged, the amount of which depends on the share of carbon credit tokens in the pool at the time of extraction. The fewer the carbon credit tokens of a climate project in the pool, the higher the pool health adjustment will be. This is done to maintain the balance of represented climate projects.
When the owner retires the TCO2 token, the Toucan protocol connects with the Puro.Earth standard via API. The standard cancels the carbon credit in the registry and sends the owner of the retired token a certificate.
As of the writing of this material (06/06/2024), 188 tokens from the CHAR carbon pool have been retired. There have been two instances of detokenization, each involving one carbon credit.
The CHAR token is actively traded on decentralized exchanges.
Although the Toucan protocol is the first functional project for CORC tokenization, further efforts should focus on promoting the use of CHAR tokens.
Due to the technology used for removing carbon dioxide from the atmosphere, the cost of Puro.Earth carbon credits is significantly higher than traditional methods (e.g., afforestation). Demand for voluntary standard carbon credits is currently low, and buyers generally require consultation when selecting them. Therefore, it is unlikely that a potential buyer will independently:
- Decide to purchase voluntary standard carbon credits.
- Conduct independent research leading to the selection of the Puro.Earth standard.
- Determine that the CHAR credits in the carbon pool meet their criteria.
- Execute a transaction to purchase CORC from the CHAR carbon pool.
It can be assumed that currently, CORC suppliers or intermediaries work directly with potential buyers.
