KlimaDAO Japan Launches Carbon Credit Marketplace with Progmat

KlimaDAO Japan is set to introduce a novel marketplace designated as KlimaDAO Japan Market, specifically designed for carbon credits. This initiative is part of their collaboration with the Progmat stablecoin platform. The aim is to explore trading carbon credits via a stablecoin issued by Progmat, targeting companies and local governments. There’s potential for this project to reach a global audience.

As a decentralized autonomous organization dedicated to combating climate change, KlimaDAO envisions that the KlimaDAO Japan Market will progressively encompass J-Credits carbon credits. These credits were recently debuted on the Tokyo Stock Exchange in October. Within time, KlimaDAO predicts expanding trading activities to a worldwide level through Carbonmark, a platform where they are presently active. J-Credit trading volumes have been relatively modest up to this point.

The global carbon credits market is currently valued at $2.9 billion, with only $288.1 million stemming from voluntary credits. Projections estimate that by 2030, the worldwide market could soar to $172.9 billion, with Japan contributing $1.9 billion to that total.

Progmat itself is supported by a coalition of banks led by Mitsubishi UFJ Financial Group (MUFG), Japan’s largest bank, through its Mitsubishi UFJ Trust and Banking division. To facilitate trades, KlimaDAO will employ the yen-pegged JPYC coin on infrastructure provided by Optage, a telecommunications firm with operations in the Kansai region. With the ecosystem’s foundational elements expected to be in place by April, the collaborators are now entering the second phase of their study.

In this second phase, JPYC will be registered as an approved electronic payment method, while Mitsubishi UFJ gears up to oversee the role of the coin’s trustee. The end of the year is the target for completing this phase, enabling the commencement of services. Concurrently, efforts to integrate with Carbonmark will also get underway.

The third phase anticipates the onset of international trading and aims to assist financial institutions and corporations in establishing their own marketplaces. This phase marks a significant step toward the global expansion of the initiative.

In a related development, Binance and MUFG revealed in September their intention to examine the use of Progmat for issuing yen-pegged and other varieties of stablecoins. Recent regulations in Japan, put into effect in June, have paved the way for this issuance.

Among notable supporters of KlimaDAO is billionaire Mark Cuban. Operating on the Polygon network, which committed to achieving carbon neutrality in 2022, the permissionless protocol signifies a progressive approach in leveraging blockchain technology for climate action.

The collaboration between KlimaDAO Japan and Progmat indicates a substantial move towards systemic trading of carbon credits, potentially rendering significant climate-positive outcomes on a national and global scale.