Flowcarbon said it has raised $70 million to develop a carbon credit tokenization protocol aimed at encouraging investment in projects that remove carbon dioxide from the atmosphere.
- Venture capital giant Andreessen Horowitz (a16z) led a $32 million funding round that included contributions from Samsung Next and Invesco. Another $38 million came from the sale of the Goddess Nature Token (GNT).
- GNT is backed by carbon credits from nature-based projects over the past five years and is traded on Celo, a proof-of-stake blockchain, Flowcarbon said Tuesday. The Celo Foundation has purchased $10 million worth of GNT to offset its own carbon emissions.
- "Demand for carbon credits has skyrocketed in recent years among companies using them to offset carbon emissions, but the ability to scale the volume of credits available has been limited by the opaque and fragmented market infrastructure of the VCM," Flowcarbon said in a statement, referring to the voluntary carbon market.
- Flowcarbon joins a crowded field. Four years ago, IBM said it was already working with Veridium Labs on a carbon credit token, and other companies are active as well. Toucan, Regen and Moss are all aiming to increase transparency and improve access to the carbon credit market. And earlier this year, JustCarbon and Likvidi opened marketplaces for their own carbon tokens. The broader movement is known as "ReFi" (Regenerative Finance).
- Arianna Simpson, general partner of a16z, believes tokenization is an "obvious solution" to help carbon supply keep pace with demand.