A gift for the Earth (the ultimate public good)
Everything we do has an impact on our planet. It’s a law of physics — every action triggers an equal and opposite reaction. We’re now beginning to grasp the consequences of humanity’s actions since the fossil fuel age began. By emitting greenhouse gases at enormous scales, for centuries we have been creating conditions that are increasingly hostile to life on Earth. We need to act to reverse these trends and form habits that give future humans a decent chance of inheriting a habitable, beautiful planet.
Consensus networks are a foundational new technology enabling the creation of a new web: the user-controlled internet. But to be secure, many blockchains (including Ethereum mainnet, for now) need to have a large carbon footprint. This is because cryptoeconomic incentive alignment is only possible if those securing the network — “miners” or “validators” — risk significant capital to participate. On Proof-of-Work networks like Ethereum (in 2021), this capital comes in the form of specialized hardware and the energy required to run it. The result is substantial resource consumption.
Fortunately, the Web3 community is moving towards adopting energy-efficient Proof-of-Stake consensus mechanisms. On Proof-of-Stake networks, validators risk economic capital to participate and earn network rewards. This radically reduces the environmental footprint of the consensus network. Regardless, blockchains affect the environment — participating in cryptonetworks carries a cost to the climate.
But for now, many of our on-chain actions have a significant environmental impact. So why use blockchains at all? Web3 technologies, and especially smart contracts, are powerful global coordination tools — just the tools we need to rise to the global challenges we face. Few projects have demonstrated the power of these tools as well as Gitcoin, which has driven almost $50m in funding to the open source projects and digital public goods that humanity relies on.
🌏 Action for the climate
At Toucan, we’re building open infrastructure that will use these global coordination tools to enable the costs of negative environmental externalities to be built into a financial system — we’re helping build an economy that is regenerative by design. Today, we’re announcing our plan to support Gitcoin by burning and donating carbon credits tokenized with the Toucan Protocol to make Grants Round 12 climate-positive.
🤔 Why not “offset”
Notice how we do not use the term “offset” when describing this planet-positive action. Why is this?
First off, carbon neutrality claims require an accurate estimate of emissions in the first place — a tricky and subjective task. And in any case, merely retiring carbon offsets to compensate means organizations often fail to meet the targets scientists have identified as being necessary to meet the 1.5° warming targets set in the Paris Agreement.
We are not playing a zero-sum game. A healthy Earth is a prerequisite for a healthy biosphere, and humans cannot thrive if the biosphere continues to be degraded. Using terms like “offset” and “net-neutral” suggest that this system is simple and can be balanced with some handy accounting tricks. Inconveniently, that is not the case.
At Toucan we recognize the interdependencies between all beings on Earth. Our goal is to help build a regenerative society that thrives within our planetary boundaries. Web3 projects that build with Toucan infrastructure can easily redirect a portion of the value created towards regenerative initiatives, thereby internalizing the cost of environmental impact and embedding “doing good” into every interaction.
🎁 2x for the planet
To kick this off, for GR12 we are giving a gift: we’re donating BCT to Gitcoin. These “Base Carbon Tonne” tokens represent carbon credits that have been tokenized using Toucan infrastructure. They essentially are carbon-reducing actions that double as value-generating financial instruments which can be used in the DeFi space.
How much BCT? Gitcoin has chosen to use carbon.fyi to estimate the carbon emissions associated with GR12’s on-chain activity. Our friends at Offsetra have developed carbon.fyi using a strongly-justified methodology for estimating these emissions. We’re working together to calculate the emissions estimate associated with the round.
Based on this emissions estimate, we are donating double that amount in BCT. When we launch the Carbon Burn module (soon™️), we’ll burn half of this carbon as a gift to Gitcoin — the first carbon retirement on behalf of a DAO ever performed on Toucan infrastructure (and the first of many 😉).
We will donate the other half of our carbon gift to GitcoinDAO.
- some of the BCT will go into the Climate matching pool in Gitcoin Grants Round 13 🏊
- some will seed the carbon-backed forest that Atlantis World is building 🎄
- some will fund a research bounty to explore a standard carbon footprint estimation methodology for the Merch, Memes and Marketing stream of GitcoinDAO — so they can embed climate action into every purchase of Gitcoin merch 💅
As a memento of Toucan’s GR12 carbon retirement to support Gitcoin’s climate action, we’ll deposit an NFT into the Gitcoin multisig account on Ethereum mainnet.
∞ Infinite games
This is just the beginning. We will be continuing to support Gitcoin in their leadership role as they show how Web3 organizations can overcome the failures of the nation state and rise to the challenge of addressing the climate crisis at scale in a meaningful way.
Toucan is building the technology to bring the world's supply of carbon credits onto energy-efficient blockchains and turn them into tokens that anyone can use. This paves the way for a more efficient and scalable global carbon market.