Last week AirCarbon Exchange (ACX) said it raised US$15 million in convertible notes led by Singapore-based decarbonization investor TRIREC. The startup provides exchanges for voluntary carbon credits and a variety of blockchain-based tokenized carbon assets.
Other backers of this pre-Series B round include Thailand’s Banpu Public Company and Mubadala Investment Company PJSC following an earlier Mubadala funding in November. This brings the total funds raised to $25 million, including an investment from the Deutsche Börse in March as part of a strategic partnership with Deutsche Börse owned European Energy Exchange (EEX).
TRIREC credited a strong founding team, “coupled with the robust structural tailwinds that the carbon markets are facing; we are convinced that ACX will be a major driver of growth in our portfolio and a significant participant in the ecosystem,” said Mevlyn Yeo, Founder and Managing Partner of TRIREC.
AirCarbon started in Singapore and initially focused on CORSIA tokens that support carbon offsets for the aviation sector. Since then, it has expanded its offering to a range of tokens, including nature-based projects such as forests, renewable energy tokens, carbon capture credits and others. It uses the Polygon public blockchain.
In April, it announced plans for a regulated voluntary carbon market and clearing house in the Middle East as part of the Abu Dhabi Global Market. It is working on establishing a voluntary carbon marketplace in Brazil and inked a deal with the Nairobi Securities Exchange to develop Kenya’s first carbon exchange.
ACX has managed to carve out an enterprise positioning within a competitive blockchain carbon credit space.
The tokenization of carbon credits is a controversial topic for several reasons. In the pursuit of sustainability, some believe corporations should focus more on reducing emissions rather than offsetting them. A few tokenized carbon credits from other blockchain startups have been criticized for being low quality. And given the rapid growth of the Toucan Protocol that tokenized carbon credits from the Verra Carbon registry, Verra suspended tokenization and launched a consultation. Verra thought it was confusing that Verra credits were marked as retired at the point of tokenization rather than consumption.