🇺🇸Carbon.Std Whitepaper English
Manifest
In the vast greenery of the Forests, where the sounds of nature weave a divine symphony and the vegetation stands as a living testament to the wonder of creation, we, at Carbon.Std, uphold our commitment as guardians of tomorrow.
We passionately believe that forest preservation is the silver thread that connects humanity to its destiny.
Every root intertwined in the moist soil, every leaf turning towards the sky, every creature dancing under the green canopy, are precious fragments of what makes us human. The Forest is more than just a forest; it is an ancestral tale of balance and harmony.
To preserve this sanctuary is to embrace our own heritage and ensure a legacy of beauty for generations to come.
By protecting the Forests, we are weaving the fibers of the future. It is the key to climate stability, the source of unexplored medicines, and a refuge for countless forms of life.
In every leaf that sways gently in the wind, in every drop of rain that nourishes the earth, we feel the pulse of the future. The Forest is our shared heritage, our guiding beacon amid the uncertainties of time.
Every step taken in its defense is an affirmation of our dedication to the well-being of the Earth and all its inhabitants.
About Us
Carbon.Std's primary objective is the integration of environmental sustainability and technological advancements in the ReFi (Regenerative Finance) sector and RWA (Real World Assets) usability.
In this perspective, the Carbon.Std project represents a connection to establish a direct link between the environmental preservation sector, sustainability, and investors in the crypto industry.
The Carbon.Std project is being developed by the technology and innovation team at Stock Capital.
Learn more about Stock Capital Holding at: http://www.stockcapital.com.br/
By tokenizing environmental assets, such as carbon credits and reforestation projects, Carbon.Std offers an opportunity for crypto industry investors to directly engage in environmental protection in a robust and institutional manner.
International Commitments
Stock Capital is committed to a wide range of international agreements and has signed frameworks that guide the company's work. This includes the UN Global Compact along with the UN Universal Declaration of Human Rights.
As signatories, we are committed to aligning our business with the Paris Agreement, the United Nations, and the sustainable development goals.
We are committed to the PRI (Principles for Responsible Investment) as we believe in a more sustainable global financial system.
Learn more here: https://unglobalcompact.org/what-is-gc/participants/161633
Certifications and Qualifications
Stock Capital holds the main certifications and qualifications necessary to operate in the sustainable market and environmental preservation. These certifications demonstrate the company's commitment to sustainable practices, ensuring that its operations are carried out with the highest level of professionalism.
Additionally, these certifications ensure that Stock Capital continues to follow quality and environmental responsibility standards recognized by international and national bodies.
VERRA - VERIFIED CARBON STANDARD
Verra is a nonprofit organization that operates the world’s leading carbon credit program, the Verified Carbon Standard (VCS) Program, as well as other social and environmental standards.
CBI - CLIMATE INITIATIVE BONDS
The CBI is an international nonprofit organization that evaluates sustainable projects and assets. This certification indicates that Stock Capital is qualified to issue green bonds to finance its projects with the CBI seal on a recurring basis.
ICMA - GREEN BOND PRINCIPLES
The Green Bond Principles (GBP) are voluntary process guidelines that recommend transparency and disclosure and promote integrity in the development of the Green Bond market, clarifying the approach to issuing a Green Bond.
ICMA - SUSTAINABILITY-LINKED BOND PRINCIPLES
The Sustainability-Linked Bond Principles provide guidelines recommending structuring features, disclosure, and reporting. They are intended for use by market participants to drive the necessary information disclosure to increase the allocation of capital to these financial products. The SLBPs apply to all types of issuers and any type of financial instruments in the capital markets. The 2023 version of the SLBP includes some adjustments to the five main components of the SLBP to accommodate all types of issuers, including sovereign and sub-sovereign entities.
BUREAU VERITAS - SECOND PARTY OPINION
Bureau Veritas is an international group, founded in 1828, dedicated to providing compliance assessment and certification services in the areas of Quality, Occupational Health and Safety, Environment, and Social Responsibility. Present in 140 countries with 1,400 offices and laboratories, 69,000 employees, including highly experienced auditors, serving more than 400,000 clients worldwide. In 2022, Bureau Veritas Group's revenue reached 5.6 billion euros.
Following ICMA's compliance and taxonomy standards for issuing Green and Sustainable Bonds, Stock Capital underwent an independent verification and audit conducted by Bureau Veritas to ensure the eligibility of the projects developed by the company in the green sector.
Origins of the Carbon Market
The carbon market was created alongside the United Nations Framework Convention on Climate Change during the Earth Summit in Rio de Janeiro in 1992. Thus, in 1997, during a meeting in Kyoto, Japan, it was decided that participating countries should commit to stricter targets for reducing greenhouse gas emissions.
Consequently, the reduction of these emissions began to hold economic value, initiating the sale of carbon credits. It was conventionally decided that one ton of carbon dioxide equals one carbon credit.
In this manner, carbon traders implemented three market mechanisms, namely:
Emissions trading: This mechanism determines that nations with CO2 emissions below the permitted levels can sell the excess to other countries emitting above the limits.
Joint implementation: This mechanism allows developed countries to work together to achieve goals related to carbon emission reduction through agreements among them.
Clean Development Mechanism (CDM): This mechanism allows developing countries, even without carbon emission reduction targets, to contribute to and invest in the carbon market by trading with countries that have established targets under the Kyoto Protocol and the UN's Agenda 2030.
Carbon Offsetting
Carbon offsetting is a credit that an individual or organization can purchase to decrease their carbon footprint. When the number of carbon offset credits obtained equals the carbon footprint of an individual or organization, that person or organization is carbon neutral.
More generally, carbon offsetting is any reduction in greenhouse gas emissions (GHG) to compensate for emissions occurring elsewhere.
Carbon offset credits indicate that an organization or person has reduced their emissions.
The term carbon offsetting is used to describe both the credit and the act of carbon offsetting.
A carbon offset credit represents a reduction of 1 metric ton of carbon dioxide emissions. The goal of carbon offsetting is to reduce all or part of a carbon footprint.
Organizations and individuals seek carbon offsetting voluntarily or to comply with regulations.
An individual or company may pay a certified company to remove a portion of carbon from the atmosphere, often in another part of the world. The client calculates their emission level, and the certified company charges a fee based on that level.
The certified company will then invest a portion of that money in a project that reduces carbon emissions.
The individual or organization receives a certificate or some other proof that they have purchased a carbon offset.
They can use this as evidence that they have demonstrated compliance.
Carbon Offset Through Credit Purchase
Emission Calculation: The company calculates the amount of greenhouse gasses it emits in its activities, such as fuel combustion or industrial production.
Carbon Credit Acquisition: Based on the emission calculation, the company purchases Carbon Credits from certified projects that reduce or remove the same amount of greenhouse gasses equivalent to what it emitted.
Emission Offset: The Carbon Credits acquired by the company are used to offset its emissions, making it carbon neutral, meaning the company's net carbon emissions are zero, contributing to combating climate change.
Carbon Footprint
A carbon footprint is the total amount of carbon dioxide and other greenhouse gasses generated by the activities of an individual or organization. It includes both direct and indirect emissions.
A direct emission originates from a source owned by the reporting entity.
An example is carbon dioxide produced from the combustion of fossil fuel inside a delivery vehicle owned by a company.
Indirect emissions result from the activities of the reporting entity but originate from sources that the reporting entity does not own. These are also called upstream or downstream activities.
Carbon Cycle in Forests
Trees, like all other plants, fix atmospheric CO₂ through photosynthesis and convert it into biomass and other materials necessary for metabolism.
Above ground, most of the long-term carbon storage in forests occurs as woody biomass.
Part of this carbon becomes soil organic carbon through the addition and decomposition of fallen branches, litter, and dead roots, and a recent study found that 50% to 70% of soil carbon storage in boreal forests occurs in roots and microorganisms and fungi associated with roots.
The remaining carbon is released back into the atmosphere through tree respiration and the decomposition of soil organic matter.
Storing carbon in woody biomass is a good choice because it is a stable and long-term carbon reservoir.
Even if a forest is no longer sequestering additional carbon or is sequestering it at low rates, the carbon previously sequestered in the biomass is preserved for a long time because wood decomposes very slowly, and tree roots prevent erosion and the subsequent oxidation of soil organic carbon.
Dynamic Cycling of Carbon Over Time
In young trees, respiration and carbon losses to the atmosphere are low; therefore, most of the carbon fixed by photosynthesis is converted into biomass and sequestered. As trees age, respiration increases because energy is needed to replace dying tissues, and a smaller proportion of carbon fixed through photosynthesis is converted into biomass and sequestered.
At a certain point, trees no longer sequester additional carbon but maintain a constant amount of carbon. This steady-state condition occurs when the carbon obtained from photosynthesis and the carbon lost through respiration are equal. Different tree species reach steady-state at different times, somewhere between 90 and 120 years.
Research indicates that late-succession forests have more stable steady-state carbon reservoirs due to a larger biomass of root-associated fungi below the zone of decomposing fungi found in the oxygen-rich upper soil layers.
Carbon Sequestration Methods
Afforestation is the planting of trees where trees have not grown (in the last 100 years). A common type of afforestation is the planting of short-rotation woody crops, such as hybrid poplar. These species grow very quickly and, as a result, sequester large amounts of carbon in a short period.
They are planted and harvested within a short time frame of 10 to 15 years, and the biomass is sold for paper and other wood-derived products.
Reforestation is the re-establishment of trees on land that has been deforested within the last 100 years.
Forest Management: Forests can be managed to maximize their carbon storage. Extending the rotation age, selective thinning to increase stock, and planting fast-growing species are techniques used to increase carbon sequestration.
Long-term forest health practices that avoid whole-tree harvesting and leave reserve trees to promote diverse soil ecology are more likely to promote maximum carbon storage.
Market Potential
The voluntary carbon market has grown almost fourfold in the last year, reaching nearly $2 billion in traded credits.
By 2030, the market is expected to reach a volume between $10 billion and $40 billion, and by 2050, it is expected to exceed $100 billion.
South America is currently one of the main suppliers in the market, with 17% of the total global credits and 19% of all worldwide offsetting.
The supply and demand for credits have been growing year by year, driven by the ESG agenda and increasing awareness of the importance of a low-carbon economy.
Demand for Carbon Credits
The number of retired carbon credits has more than quadrupled in the past seven years, reaching 173 million tons. Retirement is an important indicator as it represents the credits that are taken out of circulation and used by end buyers to offset their carbon footprint.
Retiring carbon credits is a way to reduce greenhouse gas emissions. When a carbon credit is retired, it represents a ton of emissions that are not released into the atmosphere. This can be achieved through a variety of projects, such as reforestation, energy efficiency, and renewable energy.
The growing retirement of carbon credits is a positive sign that people are becoming more aware of the impact of their emissions and are seeking ways to reduce their environmental impact.
DEMAND FOR CARBON CREDITS WILL SURPASS SUPPLY BY 2025
According to a study by the Boston Consulting Group (BCG), demand for carbon credits will surpass supply by 2025. The study predicts that demand for carbon credits will grow at an annual rate of 30% until 2030, while supply will grow at an annual rate of 15%. The growth in demand for carbon credits is driven by several factors, including:
Investor pressure on companies to reduce their greenhouse gas emissions.
The increased structuring of the carbon credit market.
Regulatory changes requiring companies to offset their carbon emissions.
Customer preference for products and services from environmentally responsible companies.
Despite the potential supply for carbon offsets, the existing structure is undersized, with major players unable to meet the entire demand. Consequently, there will be an imbalance between supply and demand for the entire period from 2024 to 2030.
The imbalance between supply and demand for carbon credits will have a significant impact on the price of credits. The price of carbon credits is expected to increase significantly in the coming years, making it more expensive for companies to offset their carbon emissions.
Carbon.Std Development Methodology
Carbon Sequestration is the term used to indicate the removal of carbon dioxide (CO₂) from the atmosphere and its transformation into oxygen (O₂). This process is done spontaneously by the forest.
Asset Used for Price Reference and Anchoring
Asset: USA - California Cap-and-Trade Program
The California Cap-and-Trade Program began operations in 2012 with the launch of its tracking system for allocation, auction, and trading of compliance instruments.
Compliance obligations began in January 2013. The program covers approximately 75% of the state's GHG emissions.
The program includes about 400 companies with emissions from the energy, industrial, transportation, and building sectors.
Allowances are distributed through a combination of auction, free allocation, and free allocation with consignment.
Auction revenue is reinvested in projects that reduce emissions, strengthening the economy, public health, and the environment, particularly in underserved communities.
The California Cap-and-Trade Program is implemented under the authority of the California Air Resources Board (CARB).
California has been part of the Western Climate Initiative (WCI) since 2007 and formally linked its program to Quebec in January 2014.
Pricing Methodology Used for Carbon.Std
The methodology used for the construction and anchoring of the price of carbon credits issued and traded by the Carbon.Std project is based on the reference price of the California Cap-and-Trade Carbon asset.
The use of the California Cap-and-Trade Carbon as a reference and price anchor is important because this asset is considered a benchmark in the carbon market.
By adopting a methodology based on the California Cap-and-Trade Program benchmark, Carbon.Std benefits from the operational credibility and reliable and accessible information about this asset.
Use Of Proceeds
COMPLIANCE
The Compliance sector is responsible for ensuring that Carbon.Std complies with all relevant laws, regulations, and industry standards. They monitor and evaluate the organization's activities to prevent any legal or regulatory violations.
Financial Allocation: 0.50%
BUSINESS DEVELOPMENT
The business development sector focuses on identifying new opportunities and partnerships to expand the reach and impact of Carbon.Std. They work to create strategic alliances and innovative business models to drive growth.
Financial Allocation: 0.50%
DEVELOPERS TEAM
The developers team plays a crucial role in building and maintaining the Carbon.Std platform. They design, code, and test the software, continuously improving its functionality to meet user needs.
Financial Allocation: 10.00%
FORESTRY ENGINEERING
The Forestry Engineering sector manages and optimizes the sustainable use of forest resources within the Carbon.Std framework. They contribute to carbon offset projects related to preservation, reforestation, and afforestation, promoting ecological balance.
This sector also includes investments for the issuance, registration, and certification of carbon credits, as well as other necessary investments for project development.
Financial Allocation: 25.00%
CORPORATE GOVERNANCE
In alignment with principles of transparency and equitable practices, the receivables for Carbon.Std's C-Level executives will be remunerated based on the percentage determined by the corporate governance sector of Stock Capital Holding.
This ensures their compensation is directly tied to the organization's performance and mission fulfillment, fostering accountability and responsibility.
This approach ensures a fair and sustainable remuneration structure, enabling the C-Level team to lead with dedication while maintaining the values of accountability and long-term success of Carbon.Std.
With Governance handling these aspects, the organization maintains its commitment to accountability, transparency, and the pursuit of a greener, more environmentally conscious future.
Financial Allocation: 30.00%
INDEPENDENT ESG CONSULTING
Carbon.Std's specialized ESG Consulting Team is essential as it ensures reliable measures, international recognition, and global alignment. This optimizes the impact of preservation actions and carbon credits, enhancing transparency, stakeholder engagement, and market value.
Financial Allocation: 0.50%
LEGAL DEPARTMENT
The Legal Department handles all legal matters for Carbon.Std. They provide legal advice, draft contracts, and protect the interests of the organization and its stakeholders, ensuring compliance with intellectual property, contracts, and other legal requirements.
Financial Allocation: 0.50%
INSTITUTIONAL
The Institutional sector focuses on building relationships with governments, NGOs, and other key stakeholders. They work to gain support and recognition for Carbon.Std's initiatives at a higher level.
Financial Allocation: 0.50%
MARKETING
The marketing sector is responsible for promoting Carbon.Std and its initiatives to the target audience. They develop marketing strategies, create campaigns, and raise awareness about the organization's environmental, social preservation, and carbon offset projects.
Financial Allocation: 3.50%
NFT DESIGN TEAM
At the heart of artistic development is the NFT design team, which excels in creating the main collection and its derivatives such as comic series, scripting, and other art forms encompassing the project.
Their expertise focuses on creating unique and valuable non-fungible tokens (NFTs) intricately linked to Carbon.Std's initiatives.
These NFTs serve as artistic masterpieces, each telling a fascinating story while raising awareness about carbon credits and other environmental assets innovatively and visually.
RESERVE FUND
The Reserve Fund sector plays a crucial role in ensuring Carbon.Std's sustainability and long-term growth. While it acts as a safety net for potential emergencies, its main focus is fostering innovation and progress.
This fund will be strategically allocated for the development of new projects, investments, and generation of carbon credits. By nurturing these initiatives, the Reserve Fund becomes a driving force, empowering Carbon.Std to lead the effort towards a greener and more sustainable future.
Financial Allocation: 4.00%
COUNTRY MANAGER
The Country Manager assumes a central position as the liaison between project stakeholders and international operations. Their role is to facilitate the continuous flow of relevant information, process updates, project progress, and reporting to stakeholders, ensuring transparency and trust in operations.
Financial Allocation: 5.00%
SOCIAL PROJECTS
Carbon.Std's social project is an innovative initiative aimed at positively impacting youth and adolescents in regions with below-average human development indices.
Through educational programs, the project aims to provide access to essential knowledge in the fields of arts, technology, and personal finance.
In the arts sphere, the project offers opportunities to explore and develop creative skills, from visual arts to music and theater, providing a stimulating environment for individual and collective expression.
In the technology realm, participants have the chance to acquire relevant skills for the contemporary digital world, including programming, game design, blockchain, and other fundamental skills for the digital economy.
Additionally, the project addresses the importance of personal finance, empowering youth to better understand and manage their finances, developing skills in financial planning and responsible investing.
By offering these educational structures together, Carbon.Std's Social Project aims to empower vulnerable youth, providing them with the tools needed to reach their full potential and contribute significantly to their communities and society as a whole.
Financial Allocation: 4.00%
PRIVATE LANDOWNERS
Carbon.Std plays a crucial role in raising awareness and engaging rural landowners in executing environmental preservation projects. By involving these landowners, the project aims to promote the adoption of sustainable practices that contribute to reducing carbon emissions and conserving natural resources.
By encouraging and financially supporting rural landowners in implementing sustainable practices, Carbon.Std not only contributes to mitigating climate change but also promotes biodiversity conservation, water and soil resource protection, and the development of resilient rural communities.
Financial Allocation: 5.00%
Escrow Account
Treasury Vault
By acquiring NFTs from the Carbon.Std collection, token holders will be funding environmental preservation projects as well as the issuance of carbon credits, which Stock Capital will manage and administer, including the processes of issuance, certification, and commercialization of this asset.
Aiming to develop real usability for Carbon.Std, Stock Capital has developed the Treasury Vault and dividend participation in the commercialization of carbon credits.
DISTRIBUTION
Stock Capital will deposit 25% of the net profitability from the commercialization of carbon credits into the Treasury Vault.
The distribution to Carbon.Std holders will be among the quantity of 10,000 Units, meaning each Carbon.Std NFT will receive a fraction of 0.0025% of the dividends allocated in the Treasury Vault.
For a holder to be eligible to receive the ideal fraction of 0.0025% corresponding to the number of NFT units they own, it is necessary for the holder to keep the Carbon.Std NFT in their Wallet.
Following governance and transparency, the holder of Carbon.Std has the right to sell, transfer, and store their assets in one or more wallets. In cases of private sales to third parties or open market sales via a marketplace, the holder will automatically renounce the right to be a participant and will cease to receive the fraction of 0.0025% corresponding to that unit of Carbon.Std NFT, transferring this right to the new holder.
Stock Capital will be developing governance technologies and infrastructure following the Decentralized Autonomous Organization (DAO) standard to automate, facilitate, and ensure transparency for Carbon.Std holders throughout the entire distribution process.
Usability - Utility Token and RWA
The NFTs from the Carbon.Std collections will act as Utility Tokens. This term is used to define assets that grant access to specific rights or resources.
Real World Assets (RWAs) on the blockchain are digital tokens representing physical and traditional financial assets, such as currencies, commodities, stocks, bonds, real estate, art, intellectual property, among other assets.
Carbon.Std will also act as an RWA (Real World Assets) token with the asset to be represented on Blockchain being a Sustainability Bonds Framework with Stock Capital Holding as the issuer and Bureau Veritas as independent Auditor and Verifier of Second Party Opinion (SPO).
Access our Documents on our Governance Panel: https://carbonstd.gitbook.io/governance
The technical basis used by Stock Capital for the development and issuance of the Sustainability Bonds Framework were the ICMA (International Capital Market Association) Guidelines, called Sustainability Bond Guidelines (SBG)¹ of 2021, Green Bond Principles (GBP)² of 2021 and amended in 2022, Social Bond Principles (SBP)³ of 2021 as amended in 2022, all as “Voluntary Process Guidelines” and the LMA Guidelines, called Green Loan Principles (GLP) of 2023 and Social Loan Principles (SLP) of 2023.
Get to know Bureau Veritas: https://group.bureauveritas.com/
Get to know International Capital Market Association ICMA: https://www.icmagroup.org/
Governance and Policies
The governance of Carbon.Std will be corporate, conducted by Stock Capital itself. In other words, the company is responsible for both developing the assets and managing and administering the capital allocated to the project.
In order to provide security and transparency to the project, Stock Capital commits to disclosing to Carbon.Std holders reports on financial transactions, investments in environmental projects, social projects carried out, and management of Use of Proceeds.
The reports will be subject to independent analysis by an independent verifier or an external consultant specialized in research, corporate treasury, and ESG analysis, responsible for ensuring their integrity and accuracy. Furthermore, whenever possible, we will be able to disclose information related to projections of the expected environmental or social impact of Eligible Investments.
IMPACT REPORT
In our Impact Report, both qualitative and quantitative indicators of Environmental and Social performance will be incorporated. This practice is aligned with the harmonized ICMA framework for impact reporting of December 2020. It is important to note that performance indicators may be updated annually, following industry best practices.
These inclusions reinforce Stock Capital's ongoing commitment to transparency and accountability, providing Carbon.Std holders with a comprehensive view of the allocation of invested resources and the Environmental and Social impact associated with Eligible Investments.
In this way, there will be full accountability to the holders, who will have extensive access to and knowledge of the resources used to operate the entire project ecosystem.
Updates on these matters will be made semi-annually on the project's official website: https://carbonstd.com
Governance and Transparency
The Carbon.Std NFT Collection is constituted by decentralized governance, structured in the form of a Decentralized Autonomous Organization (DAO).
A DAO can be defined as an entity created on the blockchain and governed without the presence of a central leader. For this purpose, the community itself conducts votes to determine which guidelines and paths the project will follow.
Regarding the collections, NFT holders will be able to choose, through voting mechanisms, artistic attributes of the upcoming collections to be launched. Additionally, collectors will also have the power to decide on narrative aspects of the comics that will be developed by the Carbon.Std team.
NFT Fundamentals
Definition of NFTs
NFTs can be defined as digital assets recorded on a blockchain. Despite their similarity to cryptocurrencies, they have a major differentiating factor: their unique identity.
As the name suggests, an NFT is a non-fungible token. This means it has unique characteristics, even when part of a set of tokens forming a collection.
Because of this, trading of this type of token has become popular in recent years, being used to create or digitally represent scarce assets, such as artwork and collectible items.
Blockchain and Chosen Token Standard
Among the numerous blockchains available for the creation of non-fungible tokens, Stock Capital has chosen Ethereum as the foundation for its collections. This decision took into account various factors.
The first is that the network is currently the most widely used not only for the creation of this type of token, but also for a wide range of tokenized projects and assets. Examples include the development of decentralized applications (dApps) and protocols related to decentralized finance (DeFi).
This is no coincidence, as Ethereum was the first blockchain network to introduce the concept of smart contracts, a feature that allows created tokens to have programmable functionalities and predefined business rules, as is the case with the Carbon.Std collection.
Because of this, Ethereum has been able to create a solid and robust network, supported by a series of validators that make it decentralized, transparent, and secure for holders of NFTs developed by Stock Capital. Among the token standards available on the network, ERC-721 was chosen.
This type of standard, widely used in the NFT industry, defines that each token will have a unique identity. This way, there can be an audit and authentication of the collectibles, ensuring that holders will have fully exclusive assets in their portfolios.
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