By now the contributing factors and risks of climate change are obvious. The role that greenhouse gases such as carbon dioxide play in our physical environment is understood as well, and consumers want action at every level. To date, the carbon offset market has been the channel by which this action is carried out.
While well-intentioned, this market is mired in issues. For starters, 95% of carbon offsets are reductions and avoidances—essentially unenforceable promises to reduce future emissions as opposed to actually removing the existing 1.5 trillion tonnes of CO2 from the atmosphere. Beyond this, there are a host of issues, including:
Double claiming, or where carbon credits get resold and multiple parties claim ownership at different times
Verifying reduction quantities
Bringing price discovery to carbon markets
Crypto has been a focus area for us at M13, and we’ve been looking for real-world applications for crypto generally and NFTs specifically. And there's no bigger and more important application than carbon removal. We’re proud to announce that M13 is leading a $7 million Series A with participation from Toyota Ventures Climate Fund. We’re joining a great set of partners including crypto investors Placeholder and North Island Ventures.
How it works
Nori is a marketplace for carbon removals built atop Ethereum and Polygon.
On the supply side, Nori partners with farmers who adopt regenerative farming practices that sequester carbon from the atmosphere. By doing so, farmers not only improve their soil quality but also are able to monetize on the Nori marketplace by selling Nori Removal Tonnes (NRTs), which represent 1 tonne of CO2 sequestered for at least 10 years.
On the demand side, buyers—consumers and businesses alike—can purchase NRTs via the Nori marketplace and each removal creates a nonfungible token (NFT) that mitigates the double counting issue that currently affects the offset market. The result is an accountable removal process where each NRT is verified and immediately retired upon purchase. Buyers to date include NFT companies such as Rarible and The Sandbox as well as global rock ‘n roll tours who really want to measure their impact.
You can go on to the ETH blockchain right now and see to the field level where this carbon has been sequestered. And this is not just theoretical: farmers have earned over $1 million selling their carbon removals on the Nori marketplace. Over time, Nori will also look to generate supply from other forms of carbon removal as those markets mature, such as kelp, direct air capture, and carbon negative cement.
How crypto and climate intersect
The relationship between crypto and climate may seem thin at first glance, but there is considerable overlap. Crypto promises immutability, and immutability brings transparency—something that is desperately needed in the carbon markets. And creating NFTs out of carbon credits brings transparency to both sides of the marketplace.
Beyond using NFTs to authenticate removals, Nori is tackling another problem in the carbon offset markets: price discovery. Nori will be launching the NORI token to bring liquidity and information symmetry to this space for all parties—from farmers and agricultural businesses to traders and buyers. We envision a world where the price of CO2 is as visible as any other tradeable commodity, such as the price of corn or wheat.
Co-founder and CEO Paul Gambill was an early Bitcoin adopter back in 2011 and started the world's first carbon removal meetup in 2015. He has a very deep understanding of both the climate and crypto markets, and we couldn’t be happier to back him and the whole Nori team. Welcome to the M13 family—we look forward to the path ahead.