Carbon Markets
Carbon Markets are developing quickly but they are fragmented and unconsolidated presenting many opportunities.
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Tesla sold $518M carbon credits in Q1 of 2021 to legacy auto manufacturers.
- Mandatory Compliance markets are expanding globally.
- Major companies are buying carbon offsets in Voluntary Markets.
| 2019 | 2020 | 2021 | CAGR | |
| Mandatory (Compliance) Market | $216B | $261B | $626B | 42% |
| Voluntary Market | $320M | $473M | $1B | 46% |
CAGR = compound annual growth rate
Here is what is going on in the Carbon Markets
California is attempting to offset its carbon emissions by investing heavily in its forests, as part of its effort to reach carbon neutrality by 2045.
Global spending on carbon offsets could increase from roughly $300 million in 2018 to as much as $100 Billion by 2030, according to the Institute for International Finance’s Taskforce on Scaling Voluntary Carbon Markets.
Bill Gates spends roughly $5 Million per year to offset his family’s carbon footprint.
The billionaire entrepreneur Mark Cuban, famous for owning the Dallas Mavericks, has been using blockchain technology to buy $50,000 in carbon offsets every 10 days, according to Cointelegraph.
Carbon offsets are a way to reduce greenhouse gas emissions in one location with compensation for emissions in another place. With the recent tokenization of carbon offsets, climate activism using the blockchain technology is increasingly becoming more popular.
Like others, Cuban is eyeing blockchain solutions to confront the climate emergency. In that regard, he told Twitter about purchasing $50,000 in carbon offsets and putting them on-chain as Base Carbon Tonnes (BCT) every 10 days with KlimaDAO. “I would love to do the same thing and probably more with removal within KLIMA,” he added.
In June, Cuban also joined the world’s first decentralized climate data marketplace dClimate as an investor and strategic advisor.