The Commonwealth Bank of Australia is behind a blockchain marketplace built to support sustainable developments. The bank announced in a press release that it’s working, in collaboration with BioDiversity Solutions Australia (BDS), on ‘BioTokens’.
These digital tokens will enable landowners, environmental groups, developers and governments to invest in sustainable development. Biodiversity credits can be generated by landholders establishing biodiversity-protection schemes on their land “in perpetuity”.
The prototype platform will facilitate the trading of biodiversity credits for the New South Wales Government’s ‘Biodiversity Offsets Scheme’.
The tradeable digital BioTokens will not only represent biodiversity credits. It’s also a crucial part of a broader effort to support local businesses across Australia.
Introduced in 2017, the project has since evolved. BDS Managing Director, Rod Barnaby, explained that they came up with the concept of a biodiversity credit marketplace thanks to the insight of a wide range of stakeholders.
Through a better understanding of the challenges and benefits of the scheme, they came up with the concept of a digital marketplace to encourage participation.
“Our vision was to help facilitate the protection of precious environmental ecosystems, while also creating an alternative source of income for landowners and rewarding them for preserving biodiversity on their land,” Barnaby explained.
Accessibility and transparency – the features of the marketplace
The bank made it clear that there’s a need to establish a transparent market for the trading of biodiversity credits, in the form of BioTokens. That’s because parties such as environmental groups and government agencies can purchase these credits as an investment.
Sophie Gilder, CBA’s Head of Experimentation & Commercialization for blockchain, AI and emerging technology, stressed the importance of an accessible, transparent and secure marketplace. The use of blockchain aligned with the bank’s and BDS’s support for exploring emerging technologies. She commented:
“Creating a transparent, accessible, secure and liquid market place for the creation and trading of biocredits, aligns with our strategic focus on sustainability, support for regional economies and exploration of emerging technologies to deliver tangible benefits to our customers.”
When it comes to compliance, BioTokens can be programmed with a complex set of rules, automating the management and adding transparency to market activity. Not only does it trades on the marketplace to happen in ‘real time’, but it also offers a simpler, streamlined experience.
The final word
Reportedly, this is the first “transparent” marketplace that allows developers and landholders to trade biodiversity credits.
According to Barnaby, BDS and CBA are looking for partners to continue developing the platform towards a commercial launch. Exporting the tokenized digital asset concept to other governmental projects is part of the bank’s next steps. Gilder said:
“We see future possibilities to extend this concept to the management and allocation of other scarce resources, such as intellectual property or water rights.”
This would allow for a “more efficient digital distribution of scarce resources while enabling governments to control and manage the schemes with real-time data.”