Blockchain could change the carbon credit market from a “fragmented mess”, into a trillion-dollar industry, says tech-business advocate Sandra Ro.

Ms Ro, chief executive officer of Global Blockchain Business Council, took part in a panel on the future of technology, on the final day of the Bermuda Tech Summit 2022.

She said that when the carbon market was developed everyone built according to their own rules and according to their own local markets, creating both a trading problem, and a credibility problem.

“There are still issues around phantom credits and whether something issued ten years ago, can still be used or should be retired,” she said. “Blockchain could be potentially very good at tokenising all of that and creating it under an interoperable way that would link the markets together, and could be trusted, verified and tradable.”

Panel moderator Stan Stalnaker, chief strategy officer and founding director of Hub Culture, said there is a lot of talk about how to tokenise carbon markets.

“You have the California market, the China market and the regional markets,” Mr Stalnaker said. “Then you have thousands of different types of carbon things, like carbon credits for different projects, which have widely different values. A carbon credit could be $3 and it could be $150.”

Ms Ro predicted that when the 27th United Nations Climate Change Conference happens in Sharm El Sheikh, Egypt, next month, there will be massive collaboration around these issues.

“There are all these different consortium groups around the world, web2 and web3, government and non government, and private sector, all realising we have to work together,” she said. “I am not saying there is a silver bullet. I think it is a multi-trillion dollar market, and goes beyond carbon credit emissions. It is much bigger.”

Mr Stalnaker said there is an emerging discussion around the idea of rights of nature.

“If you can start to identify nature and give it rights, you could also theoretically give it vaults,” he said. “Imagine if you could pay the harbour for its own protection.”

He said people tend to think of digital identity as being about a social identity, or an entity identity, but the next wave might be place-based identity.

“You will look at the mapping systems we have, and because of the metaverse, if you can link it back to geolocation, you can start to have place-based identity and then, maybe, have a route to the rights of nature,” Mr Stalnaker said.

Panellist Michael Casey, chief content officer at Coindesk, said Costa Rica successfully retired a big chunk of its debt in a debt-for-nature swap with the Sierra Club, and some others.

“It was because there was an interest from these non-government organisations to buy their commitments to biodiversity,” he said. “We got this conversation going about why don’t we create a tokenised form of that. It actually becomes a form of money.”

He said it does not mean that regular money is displaced, but that a new token could be created and traded.

“That commitment is then measured through this reliable global measure that is keeping track of all this,” he said. “The idea that we can come up with nature-backed money is really interesting.”

The three-day summit wrapped up on Friday at the Hamilton Princess & Beach Club. It was presented by the Bermuda Business Development Agency in partnership with the Government’s Economic Development Department and fintech industry association, Next Bermuda.

Sheila Warren, CEO of Crypto Council for Innovation, and Denis Pitcher, Bermuda Government fintech adviser, also spoke on the panel.

For more information see www.bda.bm/events/bermuda-tech-summit-2022