AMA RECAP — SHEESHA FINANCE & CARBO-X
Welcome you all to the recap of Ask me Anything session between Sheesha Finance and our project partner, Carbo-X.
On June 8th, 2023, Shiva Patel and Rishi Vaidya, the founding team of Carbo-X joined us to discuss about their project.
The session was hosted by Nathan Cooper, Chief program and Innovation officer at Sheesha Finance.
Nathan: Hi chaps! Please introduce yourselves. Name, Roles and dialing in from where
Rishi.: Hello everyone!
First of all, a very big thank you to Team Sheesha for all their support. Our pleasure. I know the team have been working day in day out with you and the team! Lots of things to catch up on and share with the Sheesha community
Rishi.: Let me start off by introducing my colleague Shiva Patel, who is a co-founder of Carbo-X token and heads the operations and projects.
Shiva and I are a part of 5 member co-founder team; where I am heading partnerships and marketing. Shiva is an environment Lawyer by profession
Nathan Sheesha: Now lets get to it!
Nathan Sheesha: Ive seen that the carbon credit industry plays a pivotal role in combating climate change and transitioning towards a more sustainable future. There is a lot to know about carbon credits. But I think it would be best if you could just describe to everyone:
What exactly is a carbon credit put in the most simplistic of terms
Shiva: Carbon credits are a bundle of audited certificates through a methodology certified by United Nations frame work for climate control .
1 carbon credit represents carbon reduction done of 1000kg of Green house Gas.
Nathan: So effectively what this means is that by assigning a financial value to the reduction of carbon dioxide and other harmful gases Carbon credits encourage businesses and individuals to actively participate in the global effort to mitigate climate change?
Rishi.: Yes, it is a measure to calculate carbon emissions.
Nathan: I am keen to know what part Carbo-X plays in this and Im sure everyone else is so lets get to some more difficult questions
Can you articulate the underlying philosophy and driving force behind your web3 startup CarboX
Rishi.: Carbon credit tokenization is a process of converting carbon credits, which represent the reduction of one metric ton of carbon dioxide or equivalent greenhouse gas emissions, into digital tokens that can be bought, sold, and traded on a blockchain platform. The philosophy behind this idea is to provide a more efficient and transparent way for companies and individuals to offset their carbon emissions and reduce their carbon footprint. So Carbo-X essentially makes trading of Carbon Credits easier, cheaper and faster.
The driving force behind this idea is the urgent need to reduce greenhouse gas emissions and mitigate the effects of climate change. By tokenizing carbon credits, we can create a more accessible and decentralized market that allows for greater participation, transparency, and accountability.
This will encourage more companies and individuals to invest in clean energy and sustainable practices, ultimately leading to a more sustainable and carbon-neutral future.
Nathan Sheesha: I think this is the key thing here.
How do people trade these with ease?
Shiva: Additionally, carbon credit tokenization can also provide a financial incentive for developing countries to invest in renewable energy projects and reduce their carbon emissions. By enabling them to sell their carbon credits on a global market, we can create a more equitable and sustainable global economy.
Nathan: The carbon credit ecosystem is well known by people but at a very high level. Getting the masses really interested in this is difficult enough, but corporations are very into this ecosystem and I definitely see it growing exponentially. But what inspired you to pursue this solution
How did you and the co-founding team develop a personal connection with this project?
Rishi.: There have been several inspiring factors for us to build this project.
Climate Change is one of the biggest challenges facing humanity, and our project in carbon credit tokens can contribute towards reducing greenhouse gas emissions and mitigating the impacts of climate change.
By offering a new and innovative way to incentivize and reward sustainable practices, carbon credit tokens can make a significant impact on the environment.
Rishi.: Sustainability: Carbo-X aligns with the principles of sustainability, which emphasizes meeting the needs of the present without compromising the ability of future generations to meet their own needs. Carbon credit tokens offer a way to encourage sustainable practices and investments that can help create a more sustainable future for all.
Innovation: Carbo-X tokens are built using innovative solutions and technologies that can drive the transition towards a more sustainable future. This takes away issues faced at present with Centralized exchanges around entry barriers, price discovery, broker-dealers etc.
Nathan: Thinking of future generations. Tick!
Nathan Sheesha: Interesting Id like to know more about those issues faced later on. Keep going though.
Rishi carbo x .: Most important is the Financial Benefits: Carbo-X tokens offer a way to monetize carbon reduction efforts, creating a new revenue stream for individuals and businesses. By investing in our tokens, you can potentially generate significant financial benefits for yourself and your investors.
Social Impact: The project has a positive social impact by encouraging and rewarding sustainable practices. This can help create a more environmentally conscious society and promote a culture of sustainability.
Shiva: .Financial Benefits: Carbo-X tokens offer a way to monetize carbon reduction efforts, creating a new revenue stream for individuals and businesses. By investing in our tokens, you can potentially
generate significant financial benefits for yourself and your investors
Nathan: Alot of projects we speak to have specific pain points along their journey It would not be a real startup without a few pain points!
Can you elaborate on the specific pain points and challenges that your solution aims to address?
Shiva: Carbo-X addresses following pain points faced currently in Centralized Exchanges
a. Access to credits: Centralized carbon credit trading exchanges can be limited in terms of accessibility, as they may only be available to large institutional investors and organizations. This can make it difficult for smaller companies and individuals to participate in carbon credit trading,
limiting their ability to engage in sustainable practices and monetize their carbon reduction efforts
Transaction Costs: Centralized carbon credit trading exchanges can also have high transaction costs, which can be a barrier to entry for some market participants. These costs can include fees for trading, settlement, and custody, among others.
Transparency: Centralized carbon credit trading exchanges can lack transparency, making it difficult for market participants to fully understand the underlying transactions and the environmental impact of the credits being traded.
Limited Standardization: There is currently limited standardization in the carbon credit market, which can create inefficiencies and inconsistencies in trading practices. This can make it difficult for market participants to compare.
Nathan: I know the team have been working with you on choosing a good chain to be on and you have chosen Polygon for the obvious reasons we wont need to get into but I would like to know
How CarboX fits into impacting the larget market landscape. Both domestically and internationally?
Rishi: Nathan, it was one of the most important decisions the team had to make.
Nathan: Interesting. Tell us why?
Rishi.: However, after much debate and discussions we chose Polygon. Primarily because it is a Layer 2 scaling solution for Ethereum that is becoming increasingly popular for building decentralized applications and sustainable token ecosystems. Low Transaction Fees was another decisive factor. Polygon offers significantly lower transaction fees than the Ethereum main net, making it more accessible for smaller transactions and allowing for more widespread participation in sustainable token ecosystems.
Rishi .: Our tech team were especially in favour of its fast transaction time. Transactions on Polygon are processed much faster than on the Ethereum main net, which can help reduce energy consumption and carbon emissions associated with Carbo- X transactions.
Rishi.: The other key factors were high scalability and interoperability.
Rishi.: Polygon is highly scalable, which makes it an ideal platform for building sustainable token ecosystems that can accommodate high transaction volumes without compromising on performance or decentralization. When it comes to Interoperability; Polygon is interoperable with Ethereum and other blockchain networks, which allows for seamless integration with other decentralized finance (DeFi) protocols and token ecosystems.
Nathan: Makes perfect sense to go with Polygon.
Rishi.: And last but not the least, it’s ecosystem support was unprecedented.
Rishi.: Polygon has a vibrant and growing ecosystem of developers, projects, and investors who are committed to building sustainable and innovative solutions on the platform. This provides a supportive environment for sustainability token projects to thrive and grow.
Nathan: Thanks for the above! So back to what I mentioned before how does this fit into impacting the larger market landscape?
Rishi.: Off course Nathan, let me explain this keeping in mind the upcoming COP28 event in UAE.
Shiva: The UAE has made several commitments for addressing climate change, both domestically and as part of international obligations. These commitments include:
a. UAE has pledged to reduce its greenhouse gas emissions by 23.5% by 2030 compared to a
business-as-usual scenario. This commitment was made as part of the UAE’s Intended Nationally
Determined Contribution (INDC) sent to the United Nations Framework Convention on Climate
Change (UNFCCC) ahead of the 2015 Paris Agreement.
b. The UAE has set a target of increasing the share of clean energy in its total energy mix to 50% by
2050. This target includes a focus on renewable energy sources such as solar and wind power.
c. Investing heavily in renewable energy, including the development of large-scale solar projects and
the expansion of its nuclear energy program.
d. Implemented several initiatives to improve energy efficiency, such as the adoption of energy efficient building codes and the introduction of smart grid technologies.
Nathan Sheesha: Why are you so focused on the UAE in particular?
Shiva: Carbo-X tokens can bring several benefits to the United Arab Emirates (UAE) and the COP28 (the 28th Conference of Parties to the United Nations Framework Convention on Climate Change) by promoting
carbon reduction and sustainable development. Carbo-X tokens can help the UAE meet its climate change commitments and reduce its carbon footprint.
Shiva: Cop28 being chaired here makes it an apt jurisdiction to let know the world how carbon neutrality can be achieved with the forces of carbon credit combined by web3
Shiva: The use of Carbo-X tokens can support the goals of COP28 by promoting international cooperation on climate change. Carbon credits provide a mechanism for countries to work together to reduce carbon emissions, and the use of carbon credit tokens can help to facilitate this cooperation. As such, carbon credit tokens can contribute to the overall success of COP28 in addressing the global challenge of climate change.
Nathan: Can you provide a clear and concise overview of the solution that you are offering and how it addresses the real problem we have spoken about?
Rishi.: Sure Nathan, While voluntary carbon credits are digital certificates, they leave a lot to be desired compared to other globally traded assets. Let me talk about some of the operational inefficiencies in voluntary carbon markets.
Rishi.: These are Non-transparent & has fragmented liquidity due to which Carbon credit prices are prone to fluctuations due to
opaque and diverse trading techniques like futures trading.
Rishi.: There is a tedious price discovery — Due to a scattered and non-standardized network, there are unreasonable deviations in the price of carbon credits.
Rishi.: Value diverted by middle persons — A lack of peer-to-peer connectivity means intermediaries take their own cut out of transactions, resulting in value erosion for both buyer and seller.
Rishi.: There are difficult sales cycle for corporates — Lack of transparency and standardized documentation creates issues for corporate buyers who must adhere to strict SOPs and norms for capital investments.
Rishi.: Nathan another major issue is restricted retail opportunities — The lack of on-demand liquidity in the current markets is a turnoff for the average retail investor.
Rishi.: And a key area for us to improve is the problem of low digitization — The process to enlist the carbon credit with registries is tedious, manual and time-consuming involving issue of physical documents, surveying and is highly susceptible to bureaucratic hold ups.
Nathan: So how does your project actually address all the above problems?
Shiva: Carbo-X solution addresses all the above problems by:
• Being the 1st token that is not based on zombie credits, fragmented credits or promise of generation of future carbon credits but redeemable against live 1:1 voluntary carbon credit.
• Designed for corporate, retail, institutional & compliance GHG offsetting institutes. All Carbon credits are procured from registries accredited by UNFCCC.
• Price transparency from procurement till retirement through price discovery connected to carbon
market thus, cutting intermediary.
Shiva: • Voluntary credits are LIVE, “unretired,” and therefore keep full off-chain value and can be used as an offset.
• Based on Polygon layer 2 Blockchain platform, efficient enough to become carbon negative.
Shiva: • Carbon credits, audited by independent audit firms ensuring end to-end value retention. Carbon credits from the projects will be insured to provide added comfort to the token investors about safety of underlying assets.
Optimized user experience with flexibility to trade in carbon credits across registries and project types.
Nathan: Can you highlight the unique benefits and advantages that investors and our community can expect to receive because of participating in your project?
Rishi.: Sure Nathan, Carbo-X token is in a unique position to remove all pain points that exist today in Centralized markets. There is a guaranteed redemption/ retirement of 1 carbon credit against each token held by investors. We expect the token to be listed on exchanges at USD 18 since compared to other tokens.
Rishi.: This all is ok, but how do we bring value to the investor community, which sets us apart? The answer is — the added validation to Carbon Credits obtained from projects by publication in media.
Nathan the real game changer and USP is the Insurance of credits secures a minimum guaranteed value in case of project defaults.
We work closely with project proponents to generate carbon credits and have MOUs in place for sourcing credits from other projects globally, that gives us access to the huge pool of credits,
thereby cutting the credit sourcing/ inventory risk.
The key thing for all investors to note is that Each token is redeemable/ can retire 1 carbon credit on the registry. Which means there is an underlying asset which is redeemable against the token.
Nathan: Well guys I had a few more questions for you but I might leave it to the community to ask. Ill hand the mic back over to @cryptoabhi1012 but thanks again for sharing you project with us and we look forward to developing the product into something fantastic before it goes for listing!
You are being incubated by the Sheesha Foundry and they are doing a stellar job so thanks @rishivaidya369 !
Rishi carbo x .: Thank you Nathan and thanks once again to the Sheesha Foundry for all the support and guidance.
Abhishek: Thank you Nathan. That was a great insight about the project. I am sure our community must have loved it.
I would like to thank @rishivaidya369 @ShivaCarboless for being a part of this AMA and sharing key highlights about the project.
Also, thank @TheDeFiDoctor for being such a great host again.
Finally to our beloved community for attending it
Rishi.: Thanks @cryptoabhi1012 and thank you everyone.
Shiva: Thankyou @cryptoabhi1012 and all.
Take care , cheers.
________________
About Sheesha Finance
Sheesha Finance is a Web3 Venture Studio helping web3 startups across all industries and blockchain networks build products and services that solve real-world teething problems. Based in the MENA region, Sheesha Finance is one of the first platforms to provide everyday investors with access to a diverse portfolio of early-stage projects, and its smart contract-based system is fully autonomous, making it efficient and user-friendly for both institutional and retail investors.
Learn more about Sheesha Finance: https://linktr.ee/sheeshafinance
Apply for Incubation at Sheesha Finance: https://forms.monday.com/forms/f5b40134dd7196ee1e0b190bd2bafb7e?r=use1
#KEEP SUPPORTING | #KEEP INVESTING
