Carbon credit transaction network Carbonplace has raised $45 million in “a strategic round of investment and formed its own entity.” Carbonplace, which “connects buyers and sellers of carbon credits through their banks, secured the seed funding from the financial institutions which founded the fintech: BBVA, BNP Paribas, CIBC, Itaú Unibanco, National Australia Bank, NatWest, Standard Chartered, SMBC and UBS.”
Through the investment, each bank “shares equal equity ownership in the new company which is expected to launch its platform later this year.”
Headquartered in London, Carbonplace will be “led by CEO Scott Eaton. Eaton, who has held a number of senior leadership roles in financial technology and capital markets, is joining from capital markets fintech Nivaura, where he served as CEO.”
Prior to Nivaura, he “was CEO of Algomi from 2018 until its sale to BGC in 2020.”
From 2015-2018, Scott was COO “at fixed income trading platform provider MarketAxess.”
The capital injection “represents a commitment from some of the world’s largest financial institutions, which account for nearly USD 9 trillion in total assets, to achieve Carbonplace’s vision of accelerating corporate climate action by providing transparent, secure and accessible carbon markets.”
The new company intends “to leverage this investment to scale the platform and its team to expand services to a wider client base of financial institutions and accelerate partnerships with additional carbon market participants, including registries and marketplaces around the world.”
Scott Eaton said:
“With Carbonplace, we are transforming the way that carbon credits are bought, distributed, held and retired. I am excited to take this company to the next level of its evolution, and to help unlock its massive potential to drive significant economic and social value by opening the carbon markets up to the world.”
Carbonplace, which has “been likened to the SWIFT of the carbon markets, has already piloted trades with a host of buyers, sellers, registries, and exchanges, including global payments technology company Visa, and Singapore-based marketplace Climate Impact X.”
Robert Begbie, CEO, NatWest Markets, said:
“Carbonplace creates an efficient and secure network for carbon credit transactions. According to McKinsey, global demand for voluntary carbon credits is likely to increase by a factor of 15 in the next seven years. To meet that demand, Carbonplace is delivering a reliable, secure and scalable technology that will form a crucial part of the infrastructure for carbon markets to drive climate action at scale.”
Building on its user banks’ highly regulated and standardized compliance frameworks, Carbonplace “ensures transparent and simple customer-to-customer transactions by enabling frictionless counterparty due diligence and onboarding.”
Carbon credit buyers and sellers can also “share information in real-time, ensuring traceable and streamlined settlement of carbon credit transactions, with the retirement of credits within minutes.”
Digital wallets “enable owners to reliably demonstrate ownership to the market, reducing the risks of double counting and simplifying reporting.”
As clarified in the update, the “closing of Itaú Unibanco’s acquisition of ownership shall occur following approval of the Central Bank of Brazil.”
As noted in the update, Carbonplace Limited is “a global carbon credit transaction network headquartered in London which has been developed by nine of the world’s foremost financial institutions: BNP Paribas, CIBC, Itaú Unibanco, National Australia Bank, NatWest Group, BBVA, SMBC, Standard Chartered and UBS.”
Expected to launch later this year, Carbonplace will “enable the simple, transparent, and secure transfer of certified carbon credits.”
The fintech, which “has been likened to the SWIFT of the carbon markets, will fundamentally transform how carbon credits are bought and sold by allowing simultaneous settlement of carbon credits, with immediate transfer of ownership upon payment – ensuring robust reporting and traceability during the entire carbon credit transfer process, and will be available to clients of financial institutions wanting to deliver secure and transparent access to the carbon markets.”