Sustainability has been a touchy topic in Web3 over the years. Bitcoin’s enormous carbon footprint has long been a thorn in the side of those of us who would see a blockchain future. With the world facing climate peril, it is imperative to ensure that crypto lands on the green side of history.
Of course, this is not just an issue for the crypto world. The global economy as a whole is struggling to go green. Some governments - including the EU - have implemented emissions trading schemes, otherwise known as carbon markets, setting a price companies have to pay per tonne of CO2 emitted. Companies, meanwhile, can engage in a range of measures to mitigate or offset their carbon emissions.
The risk of greenwashing
This has long been an exercise fraught with problems. It’s easy enough to select the ‘green’ option when buying a plane ticket - paying a little more for the promise of some trees to be planted to offset the carbon emissions of your flight. But even if those seeds end up going into the ground, who’s to say that the trees will grow tall, how long they will live, and how much carbon you will actually end up offsetting?
Tree planting is popular with politicians and an easy tactic for greenwashing corporations. But if not implemented correctly, says Professor Eric Lambin, co-author of a study on the subject, “there is a high risk of… releasing more carbon and losing biodiversity,"
Save the NFTrees
Now, using blockchain, the Web3 startup Coorest is bringing greater transparency and integrity to the world of tree-planting carbon offsetting. And that’s just the beginning of their plans.
Coorest sells NFTs - called NFTrees - that are individually linked to a real tree. These NFTrees generate CO2 tokens that represent the actual amount of carbon absorbed by the tree. Users can buy NFTrees, or they can buy CO2 tokens directly. CO2 tokens can then be burned in exchange for a Proof of Carbon Compensation Certificate, which contains all of the information related to the carbon capture along with a QR code and Token ID for authentication purposes.
All data is stored on-chain, which makes it immutable and totally transparent. The trees themselves are tracked by satellites utilized by Floodlight, a data analysis company, which monitors their health and calculates their actual carbon absorption based on their biomass. The holders of NFTrees receive their CO2 Tokens according to Floodlight’s data, meaning that the process remains trustworthy and transparent. The whole operation is certified by UN-accredited carbon auditor Earthood.
From metal to earth
Coorest was founded in September 2021. The project’s whitepaper was published at the beginning of that year by Nick Zwaneveld, one of the co-founders and current CEO. Having served in the Dutch Army, Nick eventually became a special forces operator, before he transitioned into tech, building virtual reality systems for the army, police, and fire department. Slowly, he became interested in crypto, investing in the tokenization of precious metals before becoming interested in the ESG agenda.
“I was always interested in technology,” he told Venly in a recent interview. “Blockchain technology is a good solution to enhance the transparency regarding carbon compensation.”
“We started with the NFT collection that gave us funding to buy land, plant the trees, and build the tech. Then, in February, we did a private sale of the CO2 token that gave us more funding. The other tech was already being built and… by November… We had the satellite data in place. The full tech and the whole application. The first plantation was fig trees. We fractionalized the orchard and planted 5000 trees.”
But, like everybody, the company’s fortunes were impacted by market conditions. After having expanded rapidly through the start of 2022, “the bear market came and we were faced with the reality. So we said, okay, why do we exist as a company and what is our added value? So we decided to do a reorganization, scale down and focus on the core of our business model - helping companies and people compensate their CO2 emissions.”
A better alternative
Market conditions are not the only challenge that Coorest faced in getting its service to market.
“The vast majority of companies that need to compensate [carbon], are non-crypto companies. We have to educate [them] that blockchain is the way to go. They have a bit of a learning curve ahead of them to show that, okay, if you're going to compensate, use blockchain technology and therefore we need to educate them.”
“That makes the sales cycle a bit longer. Because if you're just selling trees, maybe the companies think, ‘okay, that's easy.’ But if… they start to think about crypto, it takes a bit more time. But once they get it, then they cannot go back.”
Partnership with Venly
Helping onboard mainstream business into Web3 is exactly where Venly comes into the picture. The NFTrees are listed on the Venly Market, where they can be purchased with only a Gmail account and a fiat currency. Meanwhile, the Coorest dApp can be accessed using Venly Wallets, which are easy to set up and use, even for users with no prior crypto experience.
“We were happy to get in contact with Venly. That helped us greatly. For example, we can send an NFT via email using Venly services. I think that’s really great… in certain cultures, there is a tradition to give somebody a tree when a baby is born. Now you can do that digitally. You can send someone an NFTree.” This, as Nick says, is how “the space becomes more and more accessible for non-crypto users.”
The future is bright (green)
Planting trees is just the first step in Coorest’s mission to upgrade carbon offsetting with blockchain technology.
“[We want to allow] farmers to generate their own CO2 tokens which they can sell to companies looking to compensate,” explains Nick. “But because we are dealing with real-world assets - trees - they are exposed to certain risks like flooding, fire and storms. We want to give those farmers that are mainly from developing countries access to insurance so they can insure the trees, but also the carbon tokens that are generated by those trees. We basically help the farmers protect their livelihoods, but we also protect the CO2 token supply.”
“By utilizing the [CO2] in other marketplaces or web shops, you are basically leveraging the token and helping to generate revenue for the farmers so they can buy more land, plant more trees. It’s really a sustainable economy because it flows back to the farmers directly.
“In the future, it could be great if people can invest directly in farmers. Let’s say we have a farmer in Angola planting mango trees that you can actually invest in, and own that NFT from that farmer that is producing mango. Hopefully, we can build a sustainability investment platform where people can invest in projects globally and generate yield based on what they produce.
“By giving those farmers access to capital, you basically kick-start the whole economy. It’s the protection of the environment but it’s also an impulse to their local economies.”
“We are onboarding farmers globally. Then the insurance product comes on top. Crypto gives you the opportunity to dive into many industries that were closed to regular people like me. Now I’m into CO2 and I'm getting into contact with satellite data and insurance products… that can only happen in crypto, you know?
“That is the whole purpose of this. Not just to have tokens linked to pictures, but actually connect real-world use cases to the blockchain. This is how I see NFTs. Real-world use cases connected to tokens with the right mechanisms and make it available on a global scale.”
You can listen to the full interview with Nick on Venly’s Expert Talks podcast here.