You're listening to the reversing climate change,
podcast by the team at Nori. The carbon removal Marketplace.
This is a show about the innovators and entrepreneurs
developing solutions to climate change.
Now, I keep forgetting to start these things.
Introducing ourselves Siobhan so I'm going to cool it on the warm
intro again, warm open and just say hi.
I'm Ross, Kenny and I'm the creative editor of nori.
I can't even see my own title one of the co-founders that
Nori. Where carbon removal marketplace
with me is shabaan, Montoya lavender, who is a co-founder
of, thanks a ton and also works on memes podcasting and other
things with Nori. I should.
Hey hello, hey, and Jeremy, Epstein had a growth open forced
protocol coming to you live from Portugal and Jeremy.
Hey guys, thanks for having me great to be here.
Thank you for making it work, even with the jet lag and
everything. Saying earlier, this will be my
last Act of the day and that I'm turning in.
I was saying we get him, we get a nice and groggy so it is like
a happy hour podcast. Yeah.
Are you got some like meat on Verde and buckle over there?
What have you got handy? All that pistache, whatever they
are. I'm going to eat it all for
dinner. That's cool.
Yeah, we haven't done too many blockchain shows recently and or
just refine General regenerative Finance if you're not hip to
that term. ERM and why not feel like we
should and good before even introducing blockchain stuff.
Even coming covering carbon removal itself is quite
difficult. So introducing something
traditional like this is maybe, maybe tough for us or tougher
others to cover in depth or maybe that shave your head says,
can you really cover one without the other?
I don't know. Why, don't you tell us what
you're working on though? Sure.
So, open Forest protocol is using a Tech stack to solve what
we see to be the key bottleneck in delivering enough
high-quality nature based solutions to the voluntary
market. And that bottleneck is mrv the
current process to measure report and verify claims of
what's happening on the ground. Of course, with with CDR, right?
You're trying to create a commodity and that commodity is
not like something that you actually deliver.
Over to the End customer. You're not making, you're not
growing corn to bring corn to the End, customer to make corn
flakes, you're actually trying to deliver proof that that
commodity has been stored somewhere, right?
And to do that. You need this, this mrv piece
measurement, reporting and verification.
It's different for whatever methodology of recover removal.
Your undertaking in nature based Solutions.
There's number of bottlenecks and just a number of
difficulties and sort of scaling and creating A trusted proof of
impact that this ton of carbon or ultimately this unit of
biodiversity. If we're going to go there these
things have actually happened and we are creating the digital
asset record to represent that thing so that people can then
transact with that record and trusted.
So you need that connection between the the credit which is
the asset record which I am referring to and the actual
thing. In, in the real, the real world
and to deliver between those two things.
That's, that's the mrv, that's the piece where we are.
Bringing a web three Tech stack to make it decentralised
accessible to all and very, very data back to create that trust
or to go one step further that trust listen assess.
As we say, in the web, three world how to make one small
observation, which is the idea of a unit of biodiversity is
very Honey, and I imagine would make some people just howl but
okay, I will see the floor. There, I'll go ahead and I don't
know what that unit is. It's a lizard or several monkeys
or something. But we're aware that
biodiversity is like that's the Hot Topic at the coming, cop.
I mean that everyone sort of talking about it.
I have yet to wrap my arms around.
Exactly. How do you measure a how do you
measure on biodiversity right? Like what is that thing?
Let's break it down a little bit because I feel like when you
say, like the web, three Tech component, I feel like, there's
so much, talk about web three going on, and what's really, as
pertains to the climate and specifically.
And even though I've delved into a lot of this, I don't know that
we're doing a good job as a community communicating, this
accurately to like the average person likes like that which
person is like okay I've heard of like Bitcoin.
It's like what do you what do you tell them?
Like how do you pitch this? Like what is the virtue?
What is the value add of putting carbon into this like web three
platform? Yeah, that is often times the
jumping off point is well, is this Bitcoin?
Okay, I think we're both so traumatized shiv like I never
hesitate to come. I didn't you should have.
You should give me a trigger warning for this one.
Okay, good luck. Jeremy, good luck.
All right. Bitcoin is a digital currency
and One of the things that makes it super cool and has all this
uptake and people love it is the fact that it is based on the
blockchain which essentially is a is a digital Ledger.
It's just a more perfect system of accounting.
If you will if you really want to break it down that's how I
think about it is like okay this is a way to do accounting on a
global distributed level. So that we don't lose records,
we don't have questions about what is where, which acid is
wearing, particularly when you're trying to Transfer
digital value multiple times through multiple jurisdictions
all over the place. It is nice to have a system that
that you feel like you can trust because the data can't be
destroyed. It can't go anywhere and it
always gets added to this block J.
Now, that's like probably a terrible over simplification of
what that is and how do you we want, oversimplifications?
We want to make this is blockchain for dummies people.
Okay, so there's that, you have a great system of accounting
now, Now let's like Turn the Page and we're going to go look
at, look at the voluntary carbon market and look at some of the
headlines that have. All right?
Let's let's talk about the John Oliver piece, right?
There's there's a timely and I think pretty, pretty on topic
critique of some of the issues going on in the system.
Now, he has a few different critiques, I believe, but one of
them being there's double counting, there are companies
that buy these credits claim them as an offset.
Then go ahead and resell them and we know that companies do
this. We've had CEOs or former CEOs
come forward and say this kind of monkey business has happened
and likely it is still happening, right?
Anytime you have an opaque system or process with sort of
self-interest with the ability for people to self enriched to
some extent. This is Mike my cynical world
view on Humanity but I think it's holds up there will be
monkey business. If given the opportunity people
will act in a self-interested way, I'm sure there's some
Famous economist, who agrees with me.
And so that has happened in the voluntary carbon Market because
it's fragmented, you can buy a credit from here from there.
Hold it, sell it claim that you've offset with it, sort of
whatever you want to do. I speak with investors regularly
and the one. I last one, I spoke to, at the
end of our colleagues said, well, now, all this has to go
through some sort of regulatory body or a government, right?
No, no, really. Anybody can?
Create these things and it is voluntary and I will not say
Wild West that's been stricken from my vocabulary but during
that been applied here, also help you to find defecting from
the prisoner's dilemma is now known as Monkey Business.
Just a heads up. Yeah, so yeah, so you take this
sort of perfect system of accounting and you apply it to
the voluntary carbon market and I think that's a lot of what has
been done in re5 with projects that have been able to spin up.
Up get off the ground and do things around credits on a
blockchain so far and many of those.
But most of those projects pretty much all of them to date.
Perhaps Nori being one exception have been bridging tokens.
Have been taking tokens that were created through the
Machinery of a legacy system through sort of Legacy.
Actors, such as Farrah, such as gold standard, putting them on a
blockchain and accounting for them in that way with that block
chain, based accounting system. So that There isn't a question
of who owns the credit who bought it who sold it at what
price was? It retired?
Was it not retired? Those questions do get solved
when you bridge carbon onto a block chain and I think that
that's fantastic and to me that is solving sort of the second
half of the problem. It doesn't fix the supply
problem but it fixes. What do you do when the supply
exists and we no one has a clue where it's going or who owns it?
And you know, if we miss a count carbon the result is terrible.
The result is we end up essentially with more emissions
in the air rather than less. So you got to fix the accounting
thing first. I think the blockchain is a
great place to do that. That's kind of how a lot of refi
projects to date, have tackled, the game, we're doing something
different. So I like to sort of create that
separation. And I can tell you more about
sort of how we solve a problem that starts earlier that
process. But I'll stop there for a
moment. I Ways to spot that out.
Especially with regard to supply me at my least.
Charitable at Nori will see projects within the refi space,
and all things like cool. You have found a new demand
Pipeline, and that's great. But also supplies the bottleneck
and carbon removal and much of the supply, not in carbon
removal. Is not that good.
And if your funding, it aren't you?
Just going to get more low quality projects.
If you're willing to buy anything without regard to the
quality? Yes.
I'm not sure we actually I just passed my five year anniversary.
Since Nori was founded that was exciting for the founders of
nori. I was fun all that time.
Has been on mrv methodology. Just getting soil right?
It's still very difficult. We're so it like this lots of
conceptual challenges and trade-offs watching applications
and token. Economics, almost feels
relatively trivial in comparison to just dealing with the carbon.
And I'm not sure that that has fully sunk into a lot of the
refi movement just yet, but you're much closer to it than I
am. So I very well could be mistaken
on that, but that's my superficial take on it.
That's just how men before we even talk about that.
Let's define refi for our audience for our listeners.
Again, this is this is for the refined blockchain for dummies.
So, either one of you jump out with this one, if I was just
like, hey, Define refine a sentence, what would you say?
Hey, the start with defy, to even get to refi, right?
Sure. It stands for regenerative.
Finances has nothing to do with your mortgage.
So So we'll get that out of the way to me, refi is a system that
creates value with positive externalities.
In other words, something good happens with the climate with
the biosphere and value is created and so you were sort of
aligning incentives. You're aligning value and
positive outcomes. Okay, I like that.
Ross went to go stab. So make that defy connection,
which came together a couple Years ago, decentralized
Finance. But basically a way of one
application of it, one might say is loaning ones crypto without
some Central intermediary. Like you're loaning it to an
algorithm and people are borrowing it and using it and
you're being paid interest and there are many other
applications of staking tokens or other things that don't
require a bank that you're putting leaving money in a bank
in the same kind of way. So I feel like rebuy is kind of
a little bit of like a using the conventional.
Of the naming convention and kind of being like, Hey, we're
even cooler. This is this other thing,
they're all so deep, I applications within refund.
So that's like a heard you like, we apply onion here.
Yeah, there's definitely that component of access.
I think Russ that you're getting at that's important that, that,
that people can participate in things that perhaps they
couldn't. Otherwise because there is an, a
central regulatory Authority standing between them and
creating a And getting that accredited putting it on
blockchain, or of, or many other things that they could be doing.
There are a lot of hurdles right now, as we know, we've talked
about this before, I think, to getting credits verified on
various platforms on the one hand, it's like, yes, we want to
really lean into verification and robust measurements and
authenticity, you know, I talked to project developers are like
why can't afford to get my project on gold standard?
Like that's, you know, thousands of dollars that I don't have
right now. You know, these are these are
small projects, they're trying. Get off the ground.
So I think there needs to be a space somewhere in the ecosystem
for small projects to have some sort of verification that maybe
isn't yet at the super expensive industry standard level sort of
the the Legacy system has been very much one per like the one
percenters of carbon projects. Like those that are big enough
connected enough, and well-heeled enough to afford to
get through that system leaving the rest of the projects, kind
of out in the cold with Access to mrv which leads to
accreditation which ultimately is how you get a results-based
credit based financing to scale and rinse lather, repeat the
process. So there's an internal debate
that's been going on at Nori for a super long time about Dows and
to what degree things can be can and should be decentralized
because on the one hand you think I've seen Community like
like opener, click is a great example.
I think that Community is so strong that I think they could
probably write some methodologies that can and
should be. Incorporated into some carbon
removal marketplaces but and they're also communities that
work despite the fact that you don't, it's like hard to imagine
that they even would like Linux. The fact that Linux Works in
much of the world runs on Linux based operating systems is
magical and hurts my brain to even think about.
And I wonder like we have full-timers devoted to thinking
about the difficulties of mrb and soil, and carbon markets.
And the Dynamics that all have to play out to actually work.
I have a hard time thinking someone with Stake in it, who
sort of a part-time hobbyist could solve it in a way that I
could not even if there were hundreds or thousands of people
all decentralized, and collaborating, and I sort of
like GitHub repository for it. Am I mistaken?
Should I trust that decentralized process more?
And trust myself less, or is there a part of me that is
correct? I wish I had the answers for you
deserted. Those are tough questions?
Yeah, I don't know that. I don't know that.
I would know the answer to that either when I think of And
realized I certainly think of, you know, peer to peer
accountability which I think of in a positive way.
But then I also think race to the bottom sometimes you know
like as you were talking about, let's bring back the Monkey
Business, you know, the Monkey Business race to the bottom.
So it's like, where is that sweet spot between like having
the authenticity? And you know, the backing of
some of these major verifiers and then having it on this
peer-to-peer decentralization that Is more accessible is easy.
To validate, is easy to corroborate and check.
But where is the, where is The Sweet Spot?
And are you trying to find that open Forest protocol?
Are you trying to find that Inori?
Like, how do how do we get there?
Yeah, I think on the decentralization and I mean, you
can't make the rapid-fire decisions and build quickly and
all the things you need to do in a start-up environment with a
decentralized dow based governance process.
Right. So, that's where sort of this
idea of progressive decentralization comes in where
you do start off centralized and we you know if p is definitely
on this trajectory right? And the goal being ultimately
that myself, the co-founders, all of us could go away and the
system lives on because it has sort of it's grown, its wings in
its flown out, it's fully decentralized but it takes a
long time to get there and I think maybe What you're getting
at is is a little bit of like that in that interim period.
You do, have you still have those same problems of
centralization which is, I think somewhat counteracted by just
transparency. I think that's probably the best
thing that we can do is just try to be as transparent as possible
at these early stages until the point, where sort of
decentralized and transparent mechanisms, take over, because
you can't start from there. You have to that has to be more
of an endpoint. Aunt.
I'd love to read, I've been reading them.
Balaji sreenivasan has Network State recently and I'm sure
we'll get deeper into this and I bet there's I look at the
bibliography. I could probably find a good
thing to read about this, but which kinds of problems are best
suited to a sort of decentralized Open Source, ethos
and which ones do not are not well.
Served by that model, looked like sometimes in the crypto
space and interact. There's an ideological
pre-commitment to Dowing things or making this a community-based
kind of Tori model and I mean like big white on the start,
right is sort of like anti centralization anti Federal
Reserve anti-v at centralized money.
And so it's sort of Concordia, kryptos quarter cryptos culture,
but I don't want to do it just because that's the default
within the space. I want to make sure it's a wise
use of it. I've definitely been in groups
of four like I was in an occupied group in college and
that was pretty decentralised and participatory and I think
the failure of my leadership and a failure of many people.
Participate didn't work, it didn't work, dang it.
So I don't know, I think I've been indefinitely doing groups
from like, okay, strong leader here, and less of a consensus
model might be nice. Anyways, I'm just rambling.
Now, you were also in the middle of telling your Open Force
protocol story. Like we stopped and then
digressed and it was a fun digression but maybe want to
steer us back to what problems you're solving and what you're
thinking about right now. Sure.
Yeah yeah. We got a fun tangent.
Like to make this, I don't know. I always feel like it's a crap
statement, but the ultimate goal for me with open Forest protocol
is that anyone anywhere in the world has access to the
following value proposition. Here's here's where it gets
crafts and start Crossing all actually, it's just blunt it,
spin plant, trees, get paid, and that's like an oversized.
There's like major caveats behind because you have to do it
the right way, and it has to qualify, it has to be verified,
but but I don't like a very simple statement it, it's like
that. That's what I always imagined
the utopian vision of like a functional voluntary Global
carbon Market to be like, like, oh yeah, I can just plant a
beautiful forest and, you know, the market will provide, right?
And it better so far from the way that things operate right
now, there's a strong saying, you know, you've got to pay tens
to hundreds of thousands of dollars to accredit a forest
project. If your project is less than say
3,000 Acres or 1,200 hectares, forget about it.
It doesn't pencil because unique its high fixed transaction
costs. Require large transactions to be
profitable and it's the same thing with Forest projects.
There's so much expense involved that you just needed to develop
a very large project to make it profitable and there's not a lot
of land that's owned and really large tracks, like that.
And if you require 3,000 acres and above you're leaving out, I
would say 99% of potential projects from accessing.
Value from the carbon Market which we know would value.
These potentially more more, bespoke, more homegrown Forest
practitioners that are looking to restore nature and simply
receive value for something that they're doing to provide, you
know, for common good and restore the Global Commons.
That's what I think we are trying to do.
I think it's the answer May slightly vary from one ofp
member to the next. But that's how I think about it.
And you know, if we get to where I hope to get to then then
suddenly it becomes the new the new oil and gas.
If if you will where right when suddenly the world realized that
that fossil fuels had tons of value and there they were always
going to be purchased if they could be extracted.
Then you have this global economy that sprung up and you
know with go prospecting and knocking on your door and West
Texas. And say, you sir are sitting on
a gold mine. Let us help you.
Bring these assets to I get will get you paid for it, right?
Like those are the types of entrepreneurs that I want to see
building forests not pulling gas out of the ground, right?
And and putting their entrepreneurial Firepower to
finding all of the little pocket forests in and around the, the
Atlantic coast of the Amazon or wherever you are on planet
Earth. And using our platform to
essentially bring these assets to Market.
So that's maybe another take on what it is that we're building.
And analogy, which I like to kind of be analogy of the oil
and gas company going out and saying, hey, we're in extract
this and we're going to get profit on this morning to add
value to life. How does that work?
The analogy of standing Forest? I think about this and CD are
all the time. I think about how do you
communicate to people. The monetary value of an act of
removing carbon from the atmosphere and storing it
lithosphere. They are a biosphere wherever
you're storing it. How do you communicate that
after value in the sense that if I'm burning?
Fossil fuels in my home I get an immediate value received right?
Like I'm turning on my stove or my electricity, whatever it is
that I'm immediately experiencing that value and with
CDR. The value is happening where I
can't see it, right? Like an action that's being
taken. That I'm paying for that.
I don't see. And as you say, you know,
sometimes is poorly documented, so we're not even positive.
It happened. But let's pretend we have the
perfect robust system. We've Commander, we know what
happened? Still, how do you communicate
that value like? Okay, this is going to help you
because I mean, in my case, like well, we need to solve climate
change, right? Like that's the talking point is
like, well, it's too hot in California right now.
I don't know how you're doing Ross up North, but you know, all
of my friends in l.a. heirs are just scalding, you know?
So there's that sense of immediacy as climate crisis he's
increase in extreme weather increases but still there's not
the same relationship to saying I'm turning on my power now, as
opposed to, like, I'm paying to remove carbons.
Like, Hey, where's the selling point?
Do you think for, for customers? And I want to hear Ron here
Ross's, take on this and then I'm happy to respond as well.
What a, what a BS here's pun. I think that's a pretty huge
problem. We got a piece of advice early
on in Nori that no one wants to buy barcode, which is a really
important day time for us to think about.
Because so much of nori is To build a commodity Market that's
more like the Chicago Mercantile Exchange more than Indiegogo or
eBay or Airbnb where your individually choosing.
We want people to care about years of carbon stored, not
choose what's the warmest philia?
Stew thing I can buy. That's gonna like it.
That's a nice to have but not the main thing that we're trying
to maximize for. So there's one of the reasons
why I think creative has long been such a big part of Nori's
that given that this is an act. Barcode kind of thing that one
might be buying, how do you compensate with storytelling or
other means to substitute for that?
So people do the thing that we think matters most but also
don't deny them, the warm feel he's that they often are
motivated by I would say yeah and I think I'm trying to
probably walk the same Razors Edge.
I'm glad to hear you kind of talked about that, it sort of a
tension between an efficient commodity style market and
something that tells a story at the same time, right?
How do you digitize that, how do you program that into a fungible
or not fungible asset and have that data backing the credit, so
that you can mix this credit up with 10 million of its brothers
and sisters. And yet the purchaser who pulls
that credit out of the pile and goes home with it.
Can look at it and say, oh this came from this project with
these lovely people who planted these trees.
And there's these wonderful sdg goals that were also met and
that is a challenge and that is how we're looking at things and
And want to sort of tread that fine line between a, I mean, I
think probably gets a little technical like if it is fungible
or not fungible, essentially, if it is a completely unique
digital asset. That is unlike any others, or if
it's a commodity, right? If it's just like all the other
ones that we create, and I think that there's a technical Pathway
to do both that does go back to, like, what, what are you trying
to deliver it? Kind of depends on who's buying
it. You know, I think corporates are
trying to I like PR some extent and maybe like more reacted more
and more reactive PR, which we're seeing now over 40% of the
S&P 500 has made a net zero goals.
I mean, goals are different than action, but it's a step in the
right direction. And why are they doing that?
Part of it is probably to appease shareholders or appease
customers. So it's a bit of an talent to I
think people. Yeah.
So there's that. There's that reason why they buy
and then ultimately, I like to think of a carbon credit
essentially, is it it's a currency, right?
It's just it's just a thing that has value and can be exchanged
and and because of that it's not always so much about the end
user like, oh okay, we're going to make this that someone can
buy it and then retire it. I do think there is value kind
of going back to the beginning, the conversation with the
marketplaces and Of these marketplaces that without naming
names, I think are looking to create, sort of derivative, and
sort of secondary products out of these credits to appease sort
of Niche investors, who want to invest in this space and
essentially play the space as an investment opportunity.
Yeah. Used to cringe at this like, no,
that's not what you do with these because I don't know it
just didn't feel right to me but I've come around on that and I
do think ultimately, Mately. Think about what happens if you
can just create something from a carbon credit that people want
to throw money at the net result.
If all goes well is that you get more investment flowing down to
projects to begin with and you create a virtuous cycle of more
Capital flowing, into developing more carbon removal projects.
And if that is the end result, then I'm all for it.
Create whatever. Kind of financial wizard.
You want to bring to the to the game.
Bringing it fade is assuming that one.
It doesn't get retired or it does.
This is the tradable sector is sort of a non-retirement
situation. So, I mean there's a lot of
people were like no. Credit should be retired.
That's all that should happen. And I used to be in that camp
but I think I've switched to saying know if we want to create
new products out of that new Financial type products as we've
done with with mortgages and other Securities and things like
that great with the caveat that if the net result is that more
Capital flows, ultimately back to two projects because now
we've seen That there's a market for this stuff and there's an
appetite and you know, we need we need we need more projects to
be developed. So we can put more of these
credits on the market. So that more people can play in
this silly, you're going to have to convince me Jeremy.
I think I'm still in the camp of let's just retire.
The damn credits already, but I know that there's lots of people
to talk about using carbon credits.
As a financial tool has something interchangeable.
I don't fully get that. Maybe it's because I'm not part
of like the whole defy refined movement.
Yet, I I'm not integrated on that exposed enough perhaps.
But if we don't retire the credit and the credit keeps
getting treated, isn't there the risk than that?
There isn't a new carbon credit than being purchased because not
the whole problem that if we don't retire them, then another
one won't be purchased and so another ton of CO2 won't be
removed. Am I over simplifying?
This in my mind that's basically Nori's position is why we have a
Nori token and then nrt that are separated.
So one thing is retired immediately and the other is the
tradable asset. But yeah, feel free Jeremy
Siobhan. You doing my job.
For me. Thank you.
Yeah. Listen, again, I think I was in
your guys's camp and I've come around because the way I think
about it is you take a bunch of these credits and you spin
something up. Ultimately, if they're in
certain vehicles that are not being retired, like you need
your kids to say that that's bad.
But if those vehicles are sort of creating value flow from
financial markets, into creating more projects, I do feel like
that could have a negative Positive effect.
Ultimately that's the same goal as you know, let's just retire
them. We're just trying to get more
money into the system to get more projects to scale, CDR to
the you know, 10 Giga, tons per year by the end of the decade
that we know. We need to be very recently.
I had some friend asked me because I call obstacle, this is
how it works. Like the credit gets retired and
they're like says who and I was like really good point.
Dude like says, who Like we're dealing with these intangible
credits and I guess is maybe we're watching him then more or
less religion comes in because it because ostensibly I know at
least the way that we're designing it and open Force
protocol, there's essentially a retirement button, right?
Like you have a credit in a wall, a digital wallet, you hit
the retire button, right? And it's burned, like, it's
still there, it's you can see that at that was done, but the
credit is stuck there forever, right?
And no longer moves. And so that's like the says who,
it's like, well, let me give you a Address.
You can see that this happened you can see how many of these
were retired and that kind of puts that question to rest
learning something new. I didn't know you could like
burn them on the Chain. So they couldn't be transacted
again that they could. They were visible that Frozen.
I think I've takers will like that feature, right?
It puts that one arrest. It's a oh yeah, okay.
Well it says me because look at this thing.
I can tell you exactly when this happened and you know, how many
of these were retired, I'm really interested in your point.
About derivatives and to what degree this on net.
Good for carbon credits or carbon removals.
What happens when there's hundreds of millions of dollars
moving around and its derivatives are weird, synthetic
assets that are not merely representations of a ton of
carbon dioxide or a certain ton years of carbon dioxide being
stored. Is that good?
I mean I've had a financial Wizardry as a lot of complexity
to the system but also brings a lot of resources to Bear.
But if it's not done, right, it's not like more money is
necessarily flow. Enter projects being developed,
which is are concerned. Why we originally split those
out, but you seem to think that it would on that be good to have
Financial Wizardry. One might say a derivative
layer. If we want to talk crypto about
it on top of the rest of the market, why do you?
What do you think that while I unpack a little bit for us
partially because I like stirring the pot being
contrarian, it's good, it's good.
I want to, I want to hear the answer for you and Ross both
contrary to the poor. And like I said, I've sort of
flip flops. On this, but that's the camp
that I'm in today, I guess, no one knows how these things play
out. Long-term.
I think you could, you could imagine a future where it's
like, all of these unretired credits are spinning around in
this derivatives market and suddenly they get flooded and
not purchased and now no one's actually buying new credits to
retire like that scenario. And I think I don't know.
Could that be the case? Could it not?
I don't know, or will the way I am thinking about it is you're
creating an appetite from people who wouldn't otherwise Want to
buy and retire a credit, they want to buy something of value
and basically create more value off of it being Financial sort
of Wall Street. Wizard has like this, this stuff
is, you know, I can't tell you how it gets done.
It's over, it's over my head and my skill set but the way that I
imagined happened the net result being right.
You have investors that don't want to mess with with carbon
credits but they see that, you know, they can throw some money
into this machine and a little bit.
More comes out and the result being that the market now needs
to create more of these because everyone wants to play in this
game. So I think we all want the same
thing. I think we're sort of we're
telling different Futures about what happens, right?
That we all want more money to come into the system, to develop
more projects. What happens with these
unretired credits that I think is something we can only try to
predict because you're a read. Fashions of a stock operator.
Do know that bug and what it's like a Traders Memoir from like
a hundred and something years ago, I think it read it when I
was trying to learn more about how, like, equities and
commodities, markets work. But there used to be a thing
called bucket, shops, back in the day, where you would
basically just bet on whether the price of something would go
up or down, but you wouldn't actually own the underlying
asset or claim to it. So it's the derivative, yeah.
Yeah. There's one more.
One more product was that actually adding anything to the
system in a meaningful way. Like, did it lead to more of
them to the assets that were underlying, this betting game
was just, like, early stocks. This was an ox.
So then you had, and then you may have had lots of, you know,
entrepreneurs spinning up penny stock companies simply feed into
the system, right? And that's the analog to, you're
going to have lots of project developers to be going out and
like we need to, we need to plant a bunch of forest to feed
into the I mean, their underlying motive is greed, not
regen, but does it matter in the end?
I don't know. I guess was like the person the
person who is running the bucket shop would cover the other end
of the bet I'm fairly would pool with others, but I'm sure.
I think that money just went between the Bettors and the
house, I'm not sure if there was a feedback loop that even
included the underlying equities or Commodities.
Like, I'm not sure if that would have been erected at all, I
recognized as someone listening might be like, that's not how
derivatives work now. And they actually do interact in
a more meaningful way. If you're listening that cetera
because reach out and tell me how derivatives actually
forward, I'm gonna get painted as the Jordan Belfort of refi
now. So we should, we should probably
switch topics. No.
I think the guy has no concept Earth as so you both of you are
in advance of me. I didn't I've got the series 3,
licensure years ago for like mostly the way to train myself
to think more about how Commodities and derivatives
actually traitor. So I could be better at my job
at Nori, but a lot of that stuff is like when you described it as
Wizardry entirely by that. It's a, it's almost a different
kind of mind that thinks in this way.
And I don't think it's mine but let's talk a little bit more
about like the whole supply-demand stuff because I
feel like that's a Hot Topic. And in creating, you know, with
whether it's open for spreadable or Norway, you know the idea is
to provide a supply to authenticate that supply and we
What about how Demand right now? Outstrip Supply.
But honestly like if you look at like gigaton stays Gail, we are
still demand constrained in the sense that we still don't have.
Like, if you had 20 Giga, tons to offload, how easy would that
be to offload, not very right, I don't think there's a lot of
people asking for, like, 20 Giga, tons worth of carbon, but
we need to get there right, Jeremy.
How do you see, like the like, how do you factor open for
spread? Call into like the future of
like the supply demand curve at was a will be in maybe 10 years
or 20 years like or you kind of dialed into the moment right now
like getting the customers you need now.
Yeah, so I'm sure someone's done a study of right?
All of the Net Zero pledges and if and when all those come to
fruition 2030 or whether that's 20 40 or 50 like what does
demand look like at that point probably Trover or McKinsey or
silveira has done a study? Like that.
But, you know, the macro picture is, we are looking to the
Future. And we don't see a way to supply
the market given the current process.
And that is a bullish case for for Open Force protocol that
aims to be a new supplier to the market, right?
That that is sort of issuing, its own its own potential
credits at a future date. And, you know, I think that as
time moves on and hopefully these, you know, these Trends
pan out, And that we will be able to fill gaps that.
The current system simply isn't isn't feeling today and walk
into the future. So, we talked about tree humor,
I really haven't hit on any of our meetings yet, but we do
always try to make guests evaluate some of our memes or
especially ones they're in their wheelhouse.
So we act like Jason Hoffman to rate our like, death names.
And I feel like when it comes to humor and CD, are we kind of do
one of two things with, with three Forest, And first of all,
I love reforestation, and I generally think, is it as an
individual? I'm agnostic as a thing as
thanks, a ton. We certainly try to be agnostic,
like, I really do believe we needed an all-of-the-above
approach. I feel like trees are really
easy, Wildfire joke, so I go for that a lot.
I also feel like there's the just plant trees kind of cohort.
And that's an easy job to do too because it's like, well, not
enough land and etcetera, Etc. But then I also feel like Like
trees. I they become like the hero of
the joke. A lot of times when it's like,
cost comparing for popularity comparing or understanding, I
like, I use trees as the analogy to communicate, all the other,
all the other methods to people. And like, I use trees to
communicate, like, vintages of CDR, right?
Because sometimes there's a CDR vintage that you're paying for
now that won't, you know, that it gets in the queue and that
credit actually won't be removed.
That ton will be removed from the atmosphere.
For a year maybe or something. And so I tell people and explain
that by saying, well, it's like planting a tree, like you plant
the tree on day one, that doesn't mean the ton is removed
on day one, you know, like and so I feel like I always come
back to trees as like this foundational explainer for
carbon removal and maybe that's because they're by far the most
widely known and accepted method I would say.
And now you know now I feel like there's like all this kind of
controversy within Academia about Durability.
And we do. Where should we be investing?
Most resources that I'm like, I don't know.
Are we really are? We really fighting over the
scraps? Let's just invest in everything,
guys, I don't know. What do you think of like the do
you think trees are an easy story to tell?
Do you think trees are good? Fodder for climate humor?
I think they're both. I think there's very few people
who are opposed to trees right there.
The pretty easy thing to at least be agnostic about, if not
to say, I love trees like what there's nothing wrong with
trees. And that's kind of like that's
the case study for photosynthesis that we all learn
back in sixth grade biology or whatever.
Is like yeah these trees pull carbon out of the air and that's
what they're made of like, okay? So like harkening back to that
like original lesson on nature-based drawdown.
Yeah, it is sort of that's, that's the tree example that
gets drilled into our heads or at least got get rolled into
mind and I actually moved away from nature based solutions,
kind of just thought, okay, this isn't This isn't it?
You can tell I mean, obviously I flip-flop on a lot of things
because I'm open to new ideas and and I take in a lot of ideas
and ultimately I did come back to trees for a number of
reasons. And I think one of them is sort
of analogous to like this whole wall would have.
Climate change is a hoax. Well.
Okay, fine. Then we at least will have clean
clean water and very clean air, right?
And and you have all these co-benefits, right?
So even if the trees are Terrible climate solution.
They're not. You still have these massive
co-benefits and those those markets are.
We talked about, biodiversity briefly beginning like those
those types of markets are I think maybe going to a Clips
carbon at some point and then in the coming decades.
But yeah, it's a meme for sure. I mean, particularly in the, in
the CDR nerd world, I've been kind of moved away from using
the term CDR when it comes to reforestation.
Maybe it's more sequestration because maybe there has to be a
certain length of durability to qualify for the term removal.
Maybe it's a sequestration, right?
And I get it right. We've got to suss out our
terminology as a, as an industry.
But we also have to do that without getting to tribal and
fighting but with tribalism and inviting come really fun memes.
So there's a trade-off there. That's that's our father there
now but I'm with you. I feel like you know, the
inciting isn't super helpful and You know, photosynthesis at the
end of the day, whether it's in planting trees and we call that
the, the complete cycle, the complete method of carbon
removal and storage or if it's in one of the plethora of other
solutions that require photosynthesis.
Like I recently made a tick tock because I wanted to explain
photosynthesis but then I realized like, oh wow.
But like biochar and Bio-Oil and tell them like leaves all
relying on photosynthesis. There's so many solutions that
actually the mechanism for where you're moving, the molecule is
via photosynthesis and then it becomes As the storage mechanism
is kind of where the humans get more involved.
Anyways rest you want to pull up some of our forest names and
maybe we can have Jeremy right? Them minutes here.
I mean yeah I just have like one.
I pulled it from a tree memes page, ourselves only to share it
and we were going to recapture it for our own purposes.
But yeah, here's a, here's a tree.
When I don't even know, I fully understood it but hey can you
see this? Oh, you can help us.
We've been working on this one, we've been workshopping this.
So we want to convert this into Pure CDR meme using this format,
it's a picture of Luke Wilson, doing the like a tiny blip to
like kind of Grimace face that he's known for and this is Luke
Wilson's. Always looks like you just told
them and insert your own caption but this one is his tree.
Wasn't struck by lightning. It just fell apart because of
codominant stems with included Bart.
This is way too deep for instructors.
I don't know, that's what is with this deep forest.
It took me a really long time to think it through and then and
then I lap so I like it might need to simplify the language a
little bit. But oh yeah, I just pulled this.
I'm going to. I'm ditching that entire
capturing. We thought of some options being
like Luke Wilson. Always looks like you just told
him. We can figure out the mrv later.
Just told him I got the energy requirements of direct are
capture. It's just sitting there.
So, I don't know, we have to figure it out.
Be well, if you were to put a tree when I'm here, let's live
meme this. But we say like look, well son
looks like he just told him that dbh is not sufficient to measure
a tree. Luke Wilson.
Always looks like you just told him that Forest project
operators should collect and Report their own data, okay?
Okay, operational joke, I like it.
All right, you guys like just measuring like, throwing
measuring tape around the base of it or something.
I get what I explained? Our RFP process before I get to
the second part of it, where I'm like, well, yeah, no.
We're letting the, the Project's collect their own data.
And I get this face, then I get to the part where it's where
it's validated, you know, dozens to hundreds of times in a public
blockchain and the Improvement that, that provides over the
Legacy process. But again, that's I've seen this
look before I will say that. Together on, we gotta keep
working that Workshop in that one, but it seems like a pretty
good place to conclude for today.
Jeremy as we wrap up our their resources, you want to direct
people towards. I'll put links to this in the
show notes to whatever you'd like, people to see.
I would say, open Forest protocol.
Dot-org would be the place to go to get some information.
There's some opportunities there to get involved in the
community. If you're interested, we're
building a validator network, which Which we didn't talk about
much but essentially that is Forest expert organizations who
lend credibility to the verification of the data.
So essentially we're taking the best thing from web to which I
would say, is a network, right? The ability to build networks
and we're creating a network of verification bodies that
coordinate to review. All of that self-reported data
from from the forest, the reason I mention this is, if you feel
like you are one of those forests expert organizations.
We'd love to hear from And potentially add you to the
network and you can help us build the future of DMR.
Be distributed Mr. P. Wow.
That's the first time I've heard that initialism but certainly
won't be the last. Well, thanks for being here,
Jeremy. I was a lot of fun.
Thanks guys. Good rap with a nice.
Nice talking with you is. I'm glad I got to get a little,
a little education in Webster and whatnots and carbon Finance
of which, I am sorely lacking. That's um Boy I think Siobhan
like all right, enough derivative stuff.
I'm taking control of this conversations.
Jana get far away from this. Sorry.
Siobhan thanks so much for listening.
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