Carbon Pools

Carbon pools bundle carbon credits that share similar attributes to create more liquid and efficient markets.

The problem

Carbon credits are an illiquid asset class, meaning it is not easy to buy and sell them quickly and efficiently. This is because credits are highly differentiated across projects, vintages, and other characteristics.

Low liquidity creates issues for stakeholders across the VCM. On the supply front, it can mean that project developers can't quickly sell their credits at the market price. And for buyers, they often rely on a network of intermediaries to source credits and/or participate in drawn out over-the-counter (OTC) transactions. On top of this, a lack of open pricing data makes it hard to judge whether a deal is fair.

A balancing act

Carbon assets that have been bridged and tokenized into TCO2s retain differentiation with metadata such as project- and vintage-specific attributes. With carbon pools, we introduce a level of standardization by bundling TCO2s that share similar characteristics and thereby enable deep market liquidity.