Climate change is one of the biggest issues of our generation.
KlimaDAO is trying to solve it by creating incentive structures that actually work. 🧵
What is KlimaDao?
The market is not valuing our climate properly today.
@KlimaDAO is creating a truly liquid market for carbon assets and forcing the market to value them efficiently.
They are specifically focusing on carbon offsets, which are used to offset emissions.
There is no good market for these offsets anywhere.
By creating an on-chain market and buying carbon offsets, Klima is using the liquidity of Defi to create an efficient market for them.
It is poised to become the connector between crypto and the real world.
The expected impact of KlimaDao is massive:
- Carbon offsets appreciating in price, forcing companies to value emissions aka their negative externalities properly, leading to a reduction in emissions.
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- Capital flow to carbon offset projects increasing their scope and sustainability.
- Innovation in low carbon tech leading to a reduction in emissions.
- Creation of a strong community with aligned economic incentives.
How is Klima doing this?
Klima is tokenizing carbon offsets and backing each Klima token with 1 BCT.
Anyone can participate in the carbon markets by buying Klima token.
1 BCT is at least equal to 1 verified carbon offset credit.
To get that 1 verified carbon unit.
Klima needs to buy a unit from real world.
It is selling Klima tokens via Olympus style bonds to add liquidity to its treasury.
Using this liquidity it is acquiring verified carbon units from various projects such as a commercial forest.
Investing in Klima:
Klima has aligned social & economic incentives.
Investing in the token gives you exposure to the rising demand of carbon offsets as well as demand for Klima.
Similar to OHM, Klima will also have staking.
Incentivizing people to be long-term holders via staking rewards.
By owning its liquidity via the bonding mechanism it can ensure that it does not get mercenary capital.
Why can Klima succeed?
- It is solving one of the biggest problems of our times.
- It is connecting the crypto and the real world market, which are both growing markets.
- It is actually tokenizing something that is useful. Not because it is just cool to do.
- Crypto projects can also buy Klima to reduce their emission impact.
- It is using a proven model from Olympus.
At the end of the day, it is combining environmental + social + economic incentives neatly.
If Klima succeeds the environment wins.
Reduced carbon emissions, an efficient carbon asset market, and economic incentives for all participants.
Not a bad outcome at all for everyone.
I personally hold the token and will keep sharing more as the project launches.
If you are interested in deep-diving check out the medium page, discord, and on Twitter these accounts