Tokenisation consultation feedback and next steps for Gold Standard

In March 2023, Gold Standard will initiate a readiness phase of a new model for digital asset creation, integrated with the Gold Standard Registry. In this phase, Gold Standard will conduct structured consultations with invited organisations from Web3 and other sectors, to assess the suitability and completeness of potential new guidelines for the creation of digital assets, as well as engagement on the development of enabling software. This will include five web3 companies – Toucan, Flowcarbon, Thallo, Earthchain and Bitgreen - invited on the basis of their active participation in the Gold Standard-led Working Group on Digital Assets for Climate Impact, which launched in August 2022 to explore best practice principles to leverage the advantages of distributed ledger technologies as well as safeguards to avoid perverse incentives, double counting, or other risks. Consultations will also be held with other organisations seeking to create digital assets associated with Gold Standard-issued carbon credits.

The announcement follows the closure of a public consultation in 2022, which consulted on how the creation of digital tokens representing Gold Standard credits using blockchain technology should be managed. The consultation followed an update made to its terms of use in May 2022, to clarify that the creation of tokens, crypto-currencies or other digital instruments to represent Gold Standard Carbon Credits was not permitted without express written consent.

The 30-day consultation, which closed on 28 October 2022, sought views on whether and what conditions should be applied to determine whether to provide consent to organisations who wish to create such tokens. Feedback was received from over 35 organisations including web-3 based organisations and developers of carbon market projects. Responses in general provided broad endorsement of the proposals put forward by Gold Standard, with several respondents providing information and resources to inform the development of a more detailed framework. Consultation feedback can be accessed on the Gold Standard website.

Gold Standard carefully considered the feedback received in the public consultation, and following its conclusion is developing guidelines that would, if introduced, guide activity by entities seeking to create digital assets representing Gold Standard-issued carbon credits, alongside Gold Standard’s Registry App Terms of Use and its Terms and Conditions. Under such an approach, Gold Standard would not endorse the model of any third-party entity engaged in the creation of digital assets but would instead seek to guide best practice and provide a reference for holders of Gold Standard credits contemplating their transfer to any platform creating digital assets.

Open collaboration and transparency are of the highest importance to Gold Standard, with voluntary public consultations and participation in working groups standard practice for our organisation. With collaborative work such as this, we aim to encourage the creation of effective and inclusive digital solutions to achieve the high-functioning and inclusive carbon market needed to address the climate emergency. 

Margaret Kim, CEO, Gold Standard

During the readiness phase, Gold Standard intends to undertake broader consultation with interested parties alongside engagement with the organisations mentioned above. Should Gold Standard decide to introduce guidelines for the creation of digital assets, which is not yet decided, it intends to continue working in close collaboration with other partners to promote best practice across the carbon market in the interest of retaining trust and integrity.