Toucan Protocol
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The protocol provides tools that allow anyone to bring carbon credits onto the blockchain to improve the carbon market and fuel web3 innovation. Unlocking more ideas, infrastructure and incentives to finance the world’s best climate projects.
How it work
- The Carbon Bridge provides an on-ramp for carbon credits from these source registries onto the Toucan Registry, a set of smart contracts built on Polygon, an EVM-compatible blockchain running on an energy-efficient Proof of Stake consensus mechanism. Currently Verra is the only source registry Toucan has connected to the Carbon Bridge.
- Once bridged, tokenized carbon credits (called TCO2 tokens) can be deposited in a Carbon Pool. These carbon reference pools only accept carbon tokens that contain a set of attributes, meaning every TCO2 token in the pool shares a set of gating attributes. By depositing TCO2 tokens into a pool, users receive carbon reference tokens, a fungible pool token that is backed by one carbon token held in the pool's smart contract.
- Their first Carbon Pool, designed with Klima DAO, is the Base Carbon Tonne, or BCT. We will be designing and creating carbon reference pools with other attribute sets in the coming months.
- By aggregating carbon credits in the Carbon Pool smart contracts, the Toucan Protocol enables the creation of liquid carbon tokens like BCT. As fungible ERC20 tokens with deep liquidity, these carbon reference tokens serve as the carbon building block across Web3.
The Voluntary Carbon Market
- The main goal of the voluntary carbon market is to drive finance to climate-positive projects that reduce greenhouse gas (GHG) emissions. Carbon credits are the vehicle that connects carbon projects with consumers that purchase and retire credits to achieve their climate targets. A carbon credit represents a measurable and verifiable removal, reduction, or avoidance of GHG emissions and is denominated in tCO2e (which means "tonne of CO2 equivalent").