Ivy Protocol to launch carbon project platform by end 2022

Quantum Commodity Intelligence - German startup Ivy Protocol has raised funds to build a platform that will help finance carbon projects and be operational by the end of the year, its founder told Quantum on Tuesday.

The initiative, which has been in the works for several months, focuses on early-stage carbon projects that often struggle to raise money.

Niklas Terrahe, the co-founder of Ivy Protocol, tells Quantum he has spoken to tens of developers frustrated with the time and difficulty of raising funds, which is often an impediment to launching projects along with the long waiting times for certification.

"Ran by slow-moving NGOs, non-profits, and corporate investors for decades, there is a massive lack of speed, technology, transparency, and access in this space," says an early version of the company's light paper seen by Quantum.

Ivy aims to enable projects to crowdfund online, while at a later stage, it plans to focus on the issuance of carbon credits.

The company says it "is on a mission to completely transform the way carbon projects are brought into existence — speeding up the funding process, opening up this asset class to the world, circling back capital gains to project owners while creating a transparent, vital unprecedented funding flywheel for the carbon economy."

Ivy says it has been in close talks with Toucan, the initiative that brought more than 20 million mt of carbon credits onto the blockchain between late 2021 and May, and hopes to establish common trading standards between them.

One of the company's key innovations will be to fractionalise upfront funding of an offset project into purchasable tokens, thus giving smaller investors access.

Once the fundraising period of a project has ended, investors will have the option to continue buying or selling shares (i.e., project tokens) on the Ivy secondary markets.

Ivy will charge royalties on secondary market sales, thus "circling back wealth to project owners for continuous earning and financial incentives to ensure the highest possible quality of carbon reduction."

Ivy Protocol has opened waitlists for project owners and offset buyers alike.

"Toucan sees the strategic importance of projects like Ivy, and we are thrilled to support them with a Toucan Grant," said Toucan, which helped fund technical infrastructure.

"The demand for carbon credits is expected to grow by 10x in the next decade and 100x in the next 30 years. But supply can't keep up and is lagging far behind demand."

"Ivy addresses this issue by providing a way to drive financing to carbon credit developers from the beginning."

The team behind Ivy Protocol previously founded Nul, a tool for corporate carbon offsetting acquired by HR platform Athyna in 2021.