Base Carbon Tonne (BCT)

A Base Carbon Tonne (BCT) is a standardized, digital token on the Polygon blockchain that represents one tonne of verified carbon dioxide equivalent (tCO2e) removed or reduced from the atmosphere. It is created by bridging certified carbon credits from the Verra registry, specifically from projects that meet the Verified Carbon Standard (VCS). This process, known as tokenization, converts traditional, registry-held carbon credits into liquid, transparent, and programmable digital assets that can be traded, retired, or used in decentralized finance (DeFi) applications.

The primary mechanism for creating BCT is through the Toucan Protocol, a decentralized infrastructure for the carbon market. Toucan's Carbon Bridge retires a Verra-registered carbon credit and mints a corresponding BCT token as a digital representation of its environmental claim. Each BCT is backed 1:1 by a real-world credit, and its provenance—including project type, vintage, and methodology—is immutably recorded on-chain. This creates a transparent and auditable chain of custody, addressing issues of double-counting and fraud prevalent in traditional markets.

BCT serves as the foundational liquidity layer for the on-chain carbon economy. Its standardization (pooling credits from various projects into a single fungible token) enables efficient trading on decentralized exchanges (DEXs) and integration into DeFi protocols. For example, BCT can be used as collateral, staked in liquidity pools, or automatically retired within smart contracts. This programmability unlocks new use cases, such as auto-offsetting for blockchain transactions or embedding carbon neutrality directly into products and services.

The environmental integrity of BCT is anchored to the underlying Verra credits, which undergo rigorous third-party validation. Common project types in the BCT pool include nature-based solutions like reforestation and improved forest management, as well as technological solutions like renewable energy and methane capture. By bringing these credits on-chain, BCT aims to increase market transparency, reduce transaction costs, and accelerate capital flow to high-quality climate projects, though it remains subject to the governance and criteria of the off-chain registry it sources from.

The Base Carbon Tonne (BCT) is a bridged carbon credit token that functions as a standardized, liquid representation of a verified ton of carbon dioxide equivalent (tCO2e) removed or avoided. It operates on the Toucan Protocol by tokenizing credits from the Verra registry, specifically from projects that have passed a rigorous verification process. When a user retires a BCT token, it is permanently removed from circulation, and the corresponding underlying carbon credit is retired on the Verra registry, ensuring a 1:1 environmental claim and preventing double counting.

The core mechanism is the tokenization bridge. A project developer or credit holder first retires their Verra-issued Verified Carbon Unit (VCU) on the traditional registry, receiving a unique serial number. This serial number is then submitted to Toucan's bridge, which mints a corresponding BCT token on the Polygon blockchain. This process, known as "bridging", involves a cryptographic proof that the credit has been retired off-chain, creating an immutable on-chain record. The newly minted BCT is a fungible ERC-20 token, making previously illiquid and opaque carbon assets tradable on decentralized exchanges.

Once in circulation, BCT tokens enable new financial and environmental applications. They can be traded, pooled in liquidity pools like those on KlimaDAO, or used to offset emissions in decentralized applications (dApps). The transparent ledger of the blockchain allows anyone to audit the provenance and retirement history of each tonne. This system addresses key market inefficiencies in the voluntary carbon market, such as fragmentation, high transaction costs, and lack of price transparency, by creating a global, on-chain carbon marketplace.

A critical component is the retirement process. When an end-user (e.g., a company offsetting its footprint) wants to claim the environmental benefit, they send their BCT tokens to a designated retirement contract. This action burns the tokens and records the retirement event on-chain with a retirement certificate (an NFT). The retirement is also reported back to the off-chain registry (Verra) to ensure the credit's official status is updated, maintaining the integrity of the entire environmental accounting system and preventing the credit from being used again.

The BCT Pool Criteria & Standardization refers to the specific set of rules and quality thresholds that carbon credit projects must meet to be eligible for tokenization as Base Carbon Tonnes (BCT) on the Toucan Protocol. These criteria are designed to ensure fungibility, transparency, and environmental integrity within the pool by standardizing the underlying carbon credits. The rules are enforced through a combination of on-chain verification and off-chain due diligence, creating a curated basket of carbon credits that serve as the foundational liquidity layer for the decentralized carbon market.

Key standardization criteria include the requirement that all credits must be issued under the Verified Carbon Standard (VCS) and originate from projects with a vintage year of 2008 or later. This focus on a single, widely recognized registry and a modern vintage floor ensures a baseline of quality and comparability. Furthermore, the criteria mandate that tokenized credits are permanently retired on the source registry (e.g., Verra) upon bridging to the blockchain, a process that prevents double-counting and creates a transparent, immutable record of retirement on-chain.

The standardization process transforms heterogeneous carbon credits—each with unique project types, geographies, and co-benefits—into a homogeneous, fungible digital asset (BCT). This fungibility is critical for creating deep, liquid markets and enabling seamless integration with DeFi applications like lending, trading, and yield farming. By establishing a clear, auditable standard, the criteria reduce due diligence overhead for buyers and provide a trusted benchmark for the broader Web3 carbon economy, distinguishing BCT from more niche or project-specific tokenized carbon assets.