Blockchain Boosts the Carbon Credit Economy

Abstract

Carbon Credit Trading started in the year 1997. A total of 180 countries signed the Kyoto Protocol. Unfortunately, the goal set forth in the Protocol, which called on countries to reduce their greenhouse gas emissions to 1990 levels by 5% between 2008 and 2012 was never accomplished. In today’s world, environmentalists strive to promote policies and business practices that are beneficial to the environment. The rising levels of carbon dioxide in the Earth's atmosphere are a cause for global concern due to its contribution to global warming. As a result, a universal carbon market has emerged, offering opportunities for trading carbon credits both within and beyond regulated areas. Blockchain technology is characterized by a chain of blocks linked together, providing integrity and security in a variety of applications. Utilizing blockchain for trading carbon credits would enhance security, transparency, and efficiency. Consequently, this examination examines how blockchain innovation would influence the fossil fuel by product exchanging and assist the members with taking on a drawn-out arrangement in discharge decrease. Carbon credits were established as a method to reduce greenhouse gas emissions by establishing a market where companies can trade emissions permits Under the system, companies are allocated a certain number of carbon credits, which go less over time. Any excess can be offered for sale to another company. Businesses now have a financial incentive to cut their carbon emissions thanks to carbon credits. Individuals who find it challenging to reduce emissions can still run their businesses, but it will cost them more. According to supporters, the carbon credit system leads to quantified, independent emission reductions.