Climate action requires significant capital, but current funding models are far from adequate. Blockchain technology makes it easier, cheaper, and more effective to run open, secure fundraisers, with which projects can get funds directly from the people. This article discusses blockchain as a viable funding option for climate projects.
The impacts of climate change have rapidly risen to the top of the global agenda. Global warming is directly linked to a series of environmental effects such as rising sea levels, altered rainfall patterns, wildfires, and economic instability.
As the world steadily runs out of time to avoid irreversible damage, the international community is thoroughly challenged to design and implement proper mitigations. However, while numerous solutions have come up to tackle what the United Nations calls the "existential threat" of our time, it is still not entirely clear how these projects will be funded.
Investments in climate-friendly actions such as renewable energy advancements and sustainable infrastructure have been growing in recent years, but they are nowhere near enough. According to the UN, more money was spent on fossil fuels than climate efforts from January 2020 to March 2021. Therefore, from a financial perspective, the world is still taking one step forward and several steps back.
Understandably, addressing climate change is a complicated mission involving a plethora of initiatives that all require funding to succeed. Fortunately, blockchain technology promises some much-needed financial reprieve.
In this article, we discuss how the blockchain can support climate action by helping go-green projects like SmartChem (Intelligent Fluids) achieve their funding targets.
Climate initiatives, especially those large enough to cause a significant impact, need a substantial pool of investment, else they will fail miserably.
Currently, climate action faces two primary financing challenges:
1. Governments and private entities struggle to generate enough revenue, mainly because funds are often diverted to other projects.
2. Funding schemes are failing to provide necessary backing because they prioritize short-term gains over long-term climate investments.
The first issue is the hardest to solve. According to the Climate Policy Initiative (CPI), governments only need to allocate an additional US$7 billion annually to fund climate change mitigation and adaptation projects. This amount is nothing compared to the US$5 trillion that fossil fuels receive every year.
COVID-19 has also significantly changed the context of international climate finance. Many countries and organizations have had to alter their budgets to accommodate pandemic response efforts. Although the pandemic has drained climate funds, it has demonstrated the fragility of the old normal. Failing to act now could result in much greater and longer-lasting damage from climate change than from COVID-19.
As for the second issue, climate change requires long-term investments and commitments. However, because financial institutions typically favor short-term gains, sustainability projects often struggle to get funding from conventional sources. Projects like renewable energy generation can take years to yield tangible results.
As the foundation of cryptocurrencies, blockchain technology offers a viable solution to climate action's funding challenges. At its core, a blockchain is a public digital ledger that stores information in an immutable, transparent, and decentralized fashion. All blockchains are designed to work as trust machines, enabling users to easily prove their identities, protect ownership of digital assets, and verify transactions without intermediaries.
Because of these characteristics, blockchain solutions can be excellent financing options for climate-focused projects that struggle to raise money through financial institutions. As a decentralized public ledger, blockchain enables an initiative to get funding from the community.
Crypto owners can fund climate action with a few clicks by transferring some of their coins directly to a project or organization. That way, even small initiatives with no access to deep-pocketed investors and celebrities can launch effective, cost-friendly fundraisings.
Additionally, blockchain's decentralized nature gives program managers more control over their funds by enabling them to store money in their fully-owned cryptocurrency wallets rather than accounts governed by intermediaries like banks.
Most interestingly, blockchain initiatives can provide unique incentives to prospective financiers by offering them a worthy investment opportunity in exchange for funding. An initiative that launches its own cryptocurrency gives people a chance to buy a new coin with the anticipation that its value will appreciate down the road.
SmartChem (SMAC) is a green chemistry blockchain project run by Intelligent Fluids, an eco-friendly industrial cleaning products manufacturer. According to studies, industrial chemicals are among the primary environmental polluters today, accounting for around 20% of global water pollution. Moreover, of the one million tons of oil dumped into the ocean every year, 35% comes from regular operations like tank cleaning.
The skyrocketing environmental, health and sustainability awareness calls for more effective actions against harmful industrial cleaning chemicals. However, to replace solvent-based products, eco-friendly substances need not only be low-risk but also equally or more effective than traditional fluids.
For a long time, alternative cleaning products ticked the reduced-risk box but failed the effectiveness test. Now, thanks to new, patented technology from SmartChem (Intelligent Fluids), the industrial cleaning sector has products that can remove contaminants and residues effectively while guaranteeing the safety of users, equipment, and the environment.
Founded in 2006, Intelligent Fluids has gained commendable inroads in Europe and bagged a host of clients across the microelectronics, industrial maintenance, and oil and gas segments. However, the primary goal is to make intelligent, eco-friendly cleaning fluids available to a much broader market by upscaling production sites, expanding demo labs, creating impactful marketing campaigns, and venturing into the oil & gas cleaning business.
Leveraging the power of the blockchain, Intelligent Fluids is launching its cryptocurrency, SmartChem (SMAC), to drive funding and create a robust community backing. This form of fundraising offers liquidity for Intelligent Fluids, superior flexibility for customers, and a unique opportunity for investors to benefit from attractive early-adopter discounts and increased token value in the future, not to mention supporting sustainable cleaning practices.
So, if you are keen on participating in climate action, interested in cryptocurrency investment, or both, invest in the SMAC token and support Intelligent Fluids' green chemistry initiative while benefiting from a high-performing coin.