The agriculture sector acts as both a source and sink of greenhouse gases (GHG), as various agricultural activities emit these gases into the atmosphere but also capture them through soil carbon sequestration in the form of soil organic carbon. Amidst the climate challenges that the world is facing, digitalization in agriculture has appeared as a pathway to a low-emission food system. Digital technologies greatly help in mitigating GHG emissions, improving soil carbon sequestration, and thus playing a vital role in achieving carbon-neutral goals through the carbon credit mechanism. Digital agriculture technologies enhance resource use efficiency as they allow site-specific management of water, nutrients, and pesticides. Tools like remote sensing, geographic information systems (GIS), satellite imaging, and Internet of Things (IoT) offer real-time monitoring of crops and soil conditions, hence enhancing productivity and reducing emissions. Machine guidance (MG) and controlled traffic farming optimize the inputs and preserve the soil structure, which contributes to a reduced carbon footprint. Beyond the contribution to low-carbon agricultural production, digital tools also serve as a way forward in making the food supply chain more efficient. They support transparency and traceability across the supply chain, facilitating market access. Utilizing digital tools such as remote sensing, IoT sensors, artificial intelligence (AI), and machine learning supports accurate monitoring, quantification, and verification of emission reductions and soil carbon enhancements. When the reduced carbon emissions can be quantified, it can be monetized in the form of carbon credits, which can generate carbon revenue for farmers and entrepreneurs. This earned revenue holds strong potential to further reinforce this mechanism and make agriculture more climate-resilient and sustainable. However, a supportive policy and strategic approach from the government and policymakers are crucial for fully leveraging the economic potential of digital agriculture and achieving carbon neutrality.