<aside> 🌱 Cosmos ZERO, a partnership of the Interchain Foundation and the Cosmos community devised in October of 2021, is an initiative for Cosmos protocols and validators to achieve net-zero carbon emissions for their network validator node infrastructure and operations. Together, the Cosmos-based blockchain community can scale our action to meet the urgency of climate change while building a carbon market in Cosmos.
An opportunity for the Cosmos ecosystem to build a carbon market and become a carbon neutral blockchain community.
The environmental cost of blockchain technology is often cited as a barrier to widespread technology adoption. Proof of Work consensus algorithms, like Bitcoin, create an arms race of computing power in order for a miner to be the first to create a new block and obtain the reward.
Cosmos’ Proof of Stake validation system drastically improves this by driving competition to attract delegation of stake from users. Validators are not required to perform deliberately complicated calculations and thus run on relatively low-power machines. These machines are still required to be online 24/7 and perform calculations to confirm each block as it is generated.
<aside> 🌱 This results in a small carbon footprint for each blockchain in the Cosmos ecosystem, which contributes to climate change.
Major players in web3 have committed to take action to meet the urgency of climate change. Ethereum’s switch to PoS, known simply as “The Merge”, reduced their carbon footprint by 99.992%. Depicted metaphorically, Ethereum reduced its carbon admissions from the height of the Eiffel Tower to the size of a 4cm tall lego figure. In April of 2022 Polygon released their Green Manifesto, which commits to eliminating all carbon debt from the chain’s inception and going carbon negative in 2022.
The Cosmos ZERO campaign and the launch of Nature Carbon Ton brings the surging Voluntary Carbon Market (VCM) to the Cosmos ecosystem while aligning it with broader blockchain climate responsibility trends.
The Voluntary Carbon Market is a real world commodities market that has existed since the 1990s and grown exponentially over the last half decade. Between 2020 and 2021 alone, the global value of the VCM nearly quadrupled, from an estimated $520M to over $1.98B.
Partially responsible for this meteoric rise in value is the trending upward growth of individual carbon credits. Between 2020 and 2021, the average price of a carbon credit increased by nearly 60%.
Credit projects offering beyond-carbon environmental and social benefits saw a rise in popularity in 2021 and command a price premium over standard carbon credits.
As these trends are set to continue, the benefits to bringing tokenized carbon credits, and thus the VCM, to the Cosmos ecosystem are clear.