Chris Georgen, founder of social impact-focused blockchain company Topl, believes that many consumers are unaware of the consequences of their shopping habits.
“Forced labor, deforestation, destruction of endangered habitats…As responsible citizens of the world, we would not knowingly support, condone or participate in anything like this,” he said. told Magazine.
“Unfortunately, too often what we buy can lead to this (and sometimes worse). Whether we know it or not, the things we buy have a profound impact on the lives of others and the health of our planet.
Blockchain may not be able to address these issues directly, but it can play an important role in supply chain transparency and rewarding ethical behavior.
Mesbah Sabur, founder of Circularise – a blockchain company tackling traceability solutions for a more circular economy – highlights the importance for consumers to make greener choices:
“As consumers, we should be better informed about where the products we buy come from, what they are made of, and their impact on people and the planet. Therefore, making choices towards more ethical options and signaling to the market a need for change.
“Rising global challenges mean our collective responsibility to reverse the pace of environmental degradation,” says Sabur.
Many believe that tracing the origin of products allows people to better understand the impact of their products and to make more informed choices.
“We can trace the coffee beans from our morning latte across continents to see exactly what a local farmer was paid. We can even use blockchain technology to start decompressing what are known as Scope 3 carbon emissions and better understand the climate impact of the goods we buy,” says Georgen.
The public is increasingly concerned about corporate values. The way the company treats its customers, employees, and raw materials makes blockchain-based systems a natural fit for ethical consumerism.
There are two ways consumers can adopt – or, more controversially, be coerced into – ethical consumption standards. The first is to regulate and enforce rules around generation, which Energy Web – a blockchain-based nonprofit accelerating the transition to clean energy – says is coming in the near future. The second is to embed technology into products that give consumers more choice in purchasing behavior.
More robust tracking of product supply chains and expanding access to carbon markets are ways blockchain technology can encourage future ethical consumption.
Infrastructure for ethical product standards
To better understand the application of production standards, Magazine spoke with Ioannis Vlachos, commercial director of Energy Web, one of the main players working on the EU CIRPASS passport, which will see the traceability of products from end to end.
EnergyWeb aims to foster and promote the transition to interoperable public infrastructures. Regulation seems set to play a key role in facilitating this transition.
The new EU trade infrastructure will include the CIRPASS digital product passport, which brings together 30 stakeholders, including blockchain technologists. Vlachos explains that Energy Web acts as an open source middleware layer within the CIRPASS project.
“We believe as an organization that if you want to create impact, you have to be open, you have to be public. There is no place to make money strategies based on private blockchains. Or create Vendor Blocks We believe the impact comes from open-source and public things.
The goal, according to Vlachos, “is to lay the foundation for cross-industry product passports based on common rules, principles, taxonomies and standards.”
Providing information on the sustainability of different products is currently voluntary, but will soon be regulated by the European Commission. It will be mandatory that every battery imported into European Commission Member States be traced from cradle to grave.
“Regulations educate the public. If everyone is talking about this new digital passport from the European Commission, consumers are starting to become more aware of why they should care,” continues Vlachos.
Morpheus.Network also uses blockchain technology for supply chain transparency. Dan Weinberger, founder of Morpheus.Network, believes companies will have an easier time demonstrating ethical standards if a blockchain records a product’s journey.
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“By leveraging the decentralized nature of blockchain technology, companies can provide consumers with a clear record of a product’s journey from production to purchase,” he said. “Additionally, the use of smart contracts can automate compliance and certifications, making it easier for companies to demonstrate that their products meet certain ethical or sustainability standards.”
The public excluded from the carbon market
In a 2020 report, the UK Food Standards Agency find that Gen Z cares the most about the environmental impact of food and believe that technology will play a key role in delivering food with low environmental impact.
Enabling consumers to participate in these trends is an issue that requires further research and practical approaches. For example, many of these solutions are led by international bodies and are often “very fragmented and centralized,” says Alexander Mitrovich, CEO of Unique Network, a blockchain-based project that builds NFT infrastructure within the Polkadot ecosystem.
Current methods of recording carbon emissions and credits are receiving increased attention, as credits are often purchased in bulk by government agencies or large corporations. The World Economic Forum reported on the issue last year, stating that the overwhelming majority of the $851 billion carbon market is closed to the general public.
“They have high financial barriers. Carbon market regulations are issued by different central bodies that often do not align. The tokenization of carbon credits on a blockchain offers the opportunity to design a consensus to reduce emissions in accordance with international treaties like the Paris Agreement,” says Mitrovich.
One potential route to increased consumer participation is the use of non-fungible tokens that could serve as receipts and split credits so they become accessible to everyday consumers.
Mitrovich believes that carbon credit NFTs allow individuals to see the positive impact they are having on societal issues.
“Tokenized carbon credits are also transparent, immutable and avoid double counting. Using advanced NFT capabilities, various properties can be nested into tokenized carbon credits to enable various benefits and voting rights to contributors.
However, the public also needs to know how to access these climate-positive activities and, to date, blockchain companies do not provide easy entry points for the average consumer.
Provide easy entrance points
Unlocking transaction value for carbon projects and those who subscribe to them is a way for the public to participate in what otherwise seems a difficult market to access. Solid World DAO wants to make carbon markets as liquid as possible by developing diversified funding pools, thereby increasing access to markets for conscious consumers.
“This kind of brand awareness is especially important among young people, but there are also selfish reasons for knowing exactly where your products are coming from, as it helps ensure that you’re getting something safe and reliable,” says John Vibes, community manager at Solid World’s DAO.
For Energy Web, it is important that the consumer can easily verify product claims.
“I would be able to verify by simply taking my mobile phone out of my pocket, scanning the QR code on certain products and recording where the materials came from – without revealing any sensitive information but with the ability to validate on my own” , explains Vlachos.
Georgen says Topl is already helping consumers make choices that better align with their values. “Consumers can scan QR codes on everything from tea and chocolates to their clothes to see where these products came from and what kind of labor practices were used. In the future, not only can we imagine the availability of this data extending to more products, but we can even envision a world where consumers can be rewarded for shopping more ethically,” says Georgen.
With the development of easy entry points, consumers can automatically make better choices.
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