Understanding KlimaDAO Use and Value: Insights from an Empirical Analysis

Blockchain technologies have demonstrated the potential to build decentralized finance (DeFi) protocols that are composable and interoperable. One of the envisioned applications of blockchains is that of becoming a platform for markets of greenhouse-gas emissions. KlimaDAO is one of the recently launched protocols that attempts to bridge existing voluntary carbon markets to DeFi by means of building incentive mechanisms on top of tokenized carbon assets. That approach may eventually bring benefits to carbon markets in terms of liquidity and transparency and address a wider audience. Here we report the analysis of the early status of that initiative in an attempt to get insights in its actual functioning and value, and on the extent to which they are currently addressing the original goals and potential benefits of this kind of protocols.