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Recap: Building Climate Solutions panel with Polygon

Our co-founder Ryan Gledhill recently had the opportunity to join a Twitter Space to kick off Polygon’s Green Blockchain Summit, alongside BreeAnne Yek of CarbonFiSkander Ben Hamda of Oleaster, and Greg Krzeszowski of EaasGlobal.

Moderated by Fin Renton of Polygon, the conversation touched on blockchain scalability, building high-integrity carbon credits on-chain, and delved into some exciting new ReFi projects. There were even some birds pulling a cameo in the background of one listener’s question. 🐦

Listen to the full recorded space here:

Or check out the (lightly edited and condensed) excerpts of what Ryan said, below.

Transcript Exerpts

Fin Renton, Polygon: Hello everyone. And welcome to the very first event to kick off the road to our Green Blockchain Summit …

To start up today, we are discussing building on Polygon as a project focused on the future of sustainability. And we have a couple of great candidates here with us today. A very diverse group of speakers joining us to talk on a variety of projects. They’re building on Polygon involving a variety of topics, including voluntary carbon markets, transparent, clean energy, and even incentivizing nature based solutions as well. So with that note… why don’t we start off with a round of intros?

Ryan Gledhill, Thallo: Hi, I’m Ryan, and I’m a co-founder at Thallo. I’m a techie at heart having architected and built numerous projects with up to 3 billion pounds under management. I’ve been a web3 native since 2016 and topically, I actually helped build the first ever layer 2 on Ethereum with a project called FunFair back in 2017.

I’ve previously been the CTO of an institutional stable coin solution recently acquired by R3. We partnered with financial heavyweights such as BlackRock most recently working closely with the Maker DAO Foundation on a project called Monetalis, which allocated a 500 million Dai pool collateralized by ESG assets.

And now I’m enjoying #ReFiSummer at Thallo, where we’re building the leading web3 liquidity hub and trading facility for carbon credits on chain.

ReFi Summer (Photo by Raphaël Biscaldi on Unsplash)

Fin Renton, Polygon: Amazing. Looking forward to delve into that.…The big question as Polygon moves towards aligning itself with sustainability and becoming the base layer for projects focused on these initiatives, why as sustainably aligned projects did you choose to build on Polygon and what do you see as its strengths when it comes to leveraging blockchain as a tool for sustainability strategy and amplifying climate solutions?

Ryan Gledhill, Thallo: I think one of the main answers is a single word, and that word is scale. I think we’re all agreeing here that, that success in the voluntary carbon markets is directly linked to being able to scale it to orders of magnitude larger than it currently is.

And frankly, and sorry to get a bit technical, but even with sharding or other scalability techniques deployed on Ethereum, the future for Ethereum ecosystem is clearly layer 2 oriented. We need layer 2s like Polygon to handle the extreme throughput and the data availability that a highly scalable, voluntary carbon market demands.

At Thallo, we have a number of on-chain options relating to bridging purchases and retirements and even a secondary market. Deploying on Polygon leverages these fast block confirmations, but most importantly, the inexpensive transaction fees make Thallo’s operations economically viable.

Fin Renton, Polygon: Thank you. These answers are great…When you think about blockchain, where do you see integration with existing voluntary carbon markets and where do you see blockchain innovating on that?

Ryan Gledhill, Thallo: Ultimately, blockchain does two things best: it commoditizes trust and it democratizes assets. By putting carbon credits on chain, we make that asset’s life cycle transparent, from inception to feasibility verification, issuance, and so on all the way to bridging on chain. So as a result, as a carbon credit purchaser, you can see that entire journey in a click and have greater trust that those credits you’re buying are fully collateralized by real world assets.

And I think with web3, we also increased that purchasing power considerably. We democratized access to carbon credits specifically for retail purchases who were previously unable to purchase or offset or speculate on the market.

This tokenization also allows carbon credits to be used within financial instruments. So for example, you already see Celo collateralizing stablecoin reserves with green assets, such as carbon credits. And there are a myriad of other possibilities once that asset’s tokenized.

Having said all of that, carbon credits aren’t new. In reality, they’ve been around in one form or another since the Kyoto Protocol, and like any asset that’s been around for 20 plus years, there’s been processes that are built out by incumbents — like Gold StandardVerra and other carbon registries — that safeguard the integrity of these carbon offsets.

At Thallo, our stance is to innovate aggressively, but to do so in collaboration with legacy institutions, to ensure we retain this integrity and retain the integrity of the existing markets. And to this end, I’m very proud to be representing Thallo within Gold Standard’s select blockchain working group, which will be working to ensure integrity is maintained in order that innovation in the space isn’t stifled. And I think that’s super important moving forward.

Fin Renton, Polygon: Yeah, I think that’s a really great answer. One of the things that is a key element here is connecting those two spaces, right? We need to make sure we’re building that conversation and bridging the gap between the existing standards and policies and make sure that we’re communicating with them on our end as well.

…We can definitely open for some questions here as a kind of brief middle point…I see a couple requests in here…Go ahead and ask your question.

Listener Question: Question for the panel. Some of us have been working in the trenches for 20 plus years. …What synergy do you see for other ideas and efforts synergizing and in opposition to this synergy, what inertia may show up as response to your and other people’s first mover advantage?

Ryan Gledhill, Thallo: I think web3 is entirely about collaboration and that’s part of the beauty of the space. But I think rather than inertia, I think there’s a careful approach. That’s what we’re seeing certainly from registries such as VERRA and American Carbon Registry, which both issued concerns about certain web3 protocols in the space at the moment and how they’ve approached bridging onto chain.

And I think it’s just important that we take that carefully. And I think that’s the inertia that we’re seeing at the moment, but rather than inertia, I think it’s a careful approach and they want to make sure that they’re aligned with us and that we’re aligned with them. I think inertia is the wrong word. But I do think we need to work together with them.

Fin Renton, Polygon: Yeah. I think there’s, there’s definitely an education curve on both sides. Both on the standard side and then also on the blockchain or web3 side. …How do you think about quality and transparency and assurance of action when it comes to starting to decentralize some of these processes and automate some of these processes a little more when we’re talking about bringing that kind of content on blockchain?

Ryan Gledhill, Thallo: I see this in web3 all the time and certainly coming out of a bull market. Where the models are almost too innovative — they’re doomed from the start because they’re trying to take on too much in a single stroke. I think the real key is to find the minimum viable product and then iterate. And I think the minimum viable product is exactly what Toucan and some others are doing at the moment, which is bringing carbon credits on chain in the first place.

And what innovations are most important to start with to transform carbon markets? What can we make successful in the short term, which gives us a base to work from for all future innovations and collaborations? Now, for us at Thallo, we think a liquidity hub for carbon credits is absolutely key.

Once the trading facility exists on chain, we can start to look at supporting decentralized MRV (monitoring, verification and reporting) processes. For example, we can start looking at financial instruments to increase the amount of funding that’s available directly to carbon project developers and start cutting out some of the intermediaries and giving that value directly back to the project developers themselves.

So, to back to your question, Fin, I think let’s lean on registries, but also rating agencies as we move forward, like BeZero and Sylvera. And let’s not try to recreate the wheel in terms of quality for now. Transparency and assurance are key tenants of what a blockchain offers. So let’s start there, build out the fundamentals on chain and then start tackling the quality problem in a decentralized fashion as and when the infrastructure allows.

Fin Renton, Polygon: Fantastic answer. And I just want to say I really commend the quality of the speakers on this panel. I think this is really a great conversation and, I’m really enjoying hearing from everyone here and I’m sure the rest of the community is as well.

…Ryan, you mentioned earlier democratizing access, and I think that what’s so amazing about this period is the explosion of projects focused on attempting to do something about the current challenges we face with climate and other social and environmental issues as well. So it’s just great to see so many projects getting involved in the caliber that at least from my perspective, working with Polygon, has been so high. I definitely foresee a very positive future.