Credit Issuance Flow & Retirement

Credit Issuance

• Our registry is blockchain based, with credits issued and recorded on a Celo blockchain.

• This is not the same as tokenization. Our issued credits are ‘non-fungible’ (each is unique, with an identifying code linking it back to issuance, project, methodology)

• Credits only get issued ex-post, after monitoring events take place which have resulted in verified data on emissions avoided or removed.

  • Once data has been confirmed by the OCP or relevant third parties, carbon credits equal to the calculated emission reduction or removal will be issued into the Developer’s inventory of carbon credits.

• We require KYB for all owners of credits, both for internal governance and tracking.

  • For more information, see this explanation of KYB by our KYB provider, Middesk.

• Anyone can trace a credit throughout its lifecylce- incuding ownership details, whether it has been validated, when it was retired, transferred or canceled.

• Each credit has a real-time status displayed:

  • Active (after a credit has been validated and issued and is available for transfer)

  • Retired (after a credit has been retired; no further action can be taken)

  • Cancelled (if a project has been removed or stopped on the OCP registry; no further action can taken and it cannot be claimed as part of a offset or BVCM claim)

• Project data is stored on-chain with a token identifier in the format of:

  (project id + monitoring period + token id) [ epoch timestamp as monitoring period]

• Pre-Approved Sub-Registry Users may assign Beneficial Ownership of credits to a third-party organization (not an individual) after conducting KYB on all beneficial owners. Sub-Registry Users retain the right to transfer ownership to other users or beneficial owners, but they must notify the OCP before recording this in the registry and pay the applicable fees.

Credit Transfer

• Any User with carbon credits in their inventory can transfer those carbon credits to another account, by requesting a transfer on the OCP platform.

• These credits will be given the status ‘on-hold’ during the transfer process, and cannot be transferred or retired until the process is completed.

• The first transfer of a credit is subject to a transaction fee, based on credit transfer quantity and price sold at. This fee must be paid to the OCP before the credit is transferred to the new Inventory.

• In order to receive the transfer, the buyer must have a Known Account.

Retirement Process

• Any users that has undergone KYB and has credits in their inventory can retire credits.

• Retiring credits refers to sending credits / tokens to a wallet which they can not be retrieved from. This means they can no longer be sent to anyone else and the benefit is tied to the last owner.

• The beneficiary and retirement purpose must be recorded and displayed in OCP registry in order for credit to be retired. Beneficiaries undergo KYB, as well.

• All associated retirement information (i.e. beneficiary, credit quantity, and any additional ownership transfers) are made publicly available in the registry.

• In the event that credits are found to be erroneous either by grievance submission or during an annual audit, retired credits will be cancelled and cannot be used anymore.

  • [See Mitigating Project Risk: Insurance and Buffer Pool for more information on erroneous issuance]