Working with KlimaDAO, we have offset our entire historical carbon footprint.
KlimaDAO calculated we would need 4,390.96 tCO2 of on-chain carbon offsets to make Alchemix carbon neutral, allowing us to amplify our climate impact messages with a dedicated media partnership.
According to Kyle McDonald’s emissions estimates, the Ethereum network has a historical carbon footprint of roughly 18.1M tonnes attributable to its energy-intensive Proof of Work consensus mechanism. Now that the Merge has taken place, Ethereum’s footprint going forward will be minimal, as Proof of Stake is orders of magnitude more environmentally friendly. However, it’s important for the community as a whole to effectively quantify and take action for historical emissions. Doing so is a win for Ethereum as a whole, but also helps push investment and ideation into the growing ReFi (regenerative finance) ecosystem.
The good news is that taking action on historic emissions is possible in a web3-native way, thanks to KlimaDAO’s development of DeFi rails for climate finance. The KlimaDAO team has developed expertise and unique technology to make the process of removing historical emissions achievable for dApps such as Alchemix.
To measure the carbon emissions of Alchemix, KlimaDAO implemented the comprehensive emissions model developed by Kyle McDonald in his research paper Ethereum Emissions: A Bottom-up Estimate, which maps network energy usage to emissions factors.
The KlimaDAO team then analyzed Alchemix specifically using carbon.fyi, which is a tool that applies this methodology to calculate the emissions of defined contracts based on gas usage within specific blocks.
Known Alchemix contracts with carbon emissions quantified from carbon.fyi were calculated on October 5th, 2022. The total amount of tCO2 required to historically offset the protocol was found to be 4,390.96 metric tons.
Overall, the aim of on-chain carbon offsetting is to direct capital toward a diversified climate-positive strategy — demonstrating the power of public blockchains to catalyze positive environmental impact. This means retiring existing carbon credits to support sustainability projects that have verifiably avoided emissions either via technology (e.g. renewable energy installation, energy efficiency improvements) or via natural systems (e.g. protecting existing forests).
There are a wide variety of tokenized projects available that meet this criteria, including BCT (Base Carbon Tonne), MCO2 (from Moss), and NCT (Nature Carbon Tonne). All of these projects represent tokenized versions of carbon credits issued by Verra, the world’s most widely used greenhouse gas crediting program.
We have chosen an even split between BCT, MCO2, and NCT and aim to review this position annually, moving forward as a green protocol.
Head to Alchemix.fi and click the PoCO (Proof of Carbon Offset) badge to view our KlimaDAO Pledge Dashboard and the data that proves Alchemix’s commitment to building a better future.
Scoopy talking to KlimaDAO on their Podcast: