Smart Contracts for the European Union’s Carbon Removal Certification Framework: A Path Towards Transparent and Efficient Carbon Markets
摘要
The European Union’s endeavor to achieve climate neutrality by 2050 encompasses the adoption of the Carbon Removal Certification Framework to promote sustainable agricultural practices and sequester carbon through carbon farming. This process entails the conversion of agricultural land into carbon sinks, which presents economic and administrative hurdles, especially impacting small-scale farmers. The proposed incorporation of blockchain technology is aimed at improving the transparency and effectiveness of carbon credit transactions within this framework. The EU framework also establishes certification criteria to guarantee high-quality carbon removals, involving key stakeholders such as certification bodies and a central offset registry to uphold the integrity and credibility of the carbon market. The utilization of blockchain technology and Smart Contracts enables the monitoring of carbon credits and simplifies transactions by removing intermediaries, thus lowering expenses and increasing direct funding for carbon reduction initiatives. This holistic approach not only supports the climate objectives of the EU but also enhances market efficiency and fosters stakeholder confidence in carbon trading.