The nascent blockchain sector could provide growth for the carbon credit market
The carbon credit market may add an additional growth component with another nascent market: blockchain technology. As blockchain adoption becomes more widespread, the carbon credit market could also benefit.
Most often associated as the underlying technology underpinning cryptocurrencies, blockchain is also being used to disrupt the traditional financial system. From accounting to facilitating transactions, blockchain is already permeating other sectors and may eventually enter the carbon credit market.
“Right now, climate change has become one of the most critical problems facing the world. It affects everyone who lives on this planet and could have serious lasting consequences for all of humanity if left unaddressed.” a Carbon Credits article said. “That’s why carbon credits have been on the radar in all sectors – not just the obvious ones like Energy, agriculture and forestry. And one of those industries is blockchain technology.”
Given the growth potential, there has been an increase in carbon crypto companies, the article says. The benefits of blockchain technology can also serve well in the carbon credit market, opening up potential investment opportunities along the way.
“The strengths of blockchain technology, such as its transparency, secure record-keeping and decentralization are advantages for carbon credits,” the article added. “That’s why many carbon crypto companies are already up and running. There’s a huge opportunity here for two of the biggest current investment trends to develop their synergies.”
Get all-inclusive exposure to the carbon credit market
Recent developments in the carbon credit market add a growth factor to any portfolio in need of diversification. As such, consider KraneShares Global Carbon Strategy ETF (KRBN)which offers a broad-based alternative to the global carbon credit market.
KRBN is benchmarked to the IHS Markit’s Global Carbon Index, which offers broad coverage of cap-and-trade carbon quotas by tracking the most traded carbon credit futures contracts. The index introduces a new measure to hedge risk and go long on the price of carbon while supporting responsible investment.
Currently, the index covers the major European and North American cap-and-trade programs: European Union Allowances (EUA), California Carbon Allowances (CCA), Regional Greenhouse Gas Initiative (RGGI) and United Kingdom Allowances (UKA). KRBN comes with a cost share of 0.78%.
We believe $KRBN and #carbon #markets is poised for a breakout year in 2023. In our latest climate report, we cover the key drivers of each major ETS, including policy reforms, #geopolitics dynamics, and #Energy supply.
Download: pic.twitter.com/GHSrNjl3U4— KraneShares (@KraneShares) 9 February 2023
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