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First we had Proof of Work blockchains (Bitcoin is and Ethereum was), then we had Proof of Stake blockchains (Ethereum is as are the majority of the rest). Increasingly blockchain tech is being used to provide more credibly neutral, transparent and permissionless tools to provide proof of other things too, not just as conensus mechanisms.
Last year, for example, Multicoin Capital presented their thesis on Proof of Physical Work and highlighted projects such as Helium and Hivemapper as examples. While the former has become more maligned as the proof of utility of those Proof of Physical Work, as measured in revenues from the decentralized IoT network turned out be virtually nothing, other Proof of Physical Work projects including Hivemapper seem to be doing well.
Leave it to the ReFi community, however, to push the envelope regarding leveraging crypto rails to achieve impact outcomes. ReFi was born at the intersection of regenerative economics and DeFi withe the goal of accelerating the shift to a more inclusive, regenerative and low-carbon economy.
At its roots, the exploding ReFi space is about creating more transparency and pathways to positive impact on communities and the planet. In light of the skepticism around carbon offsets, exacerbated by recent media attention to the potential flaws of opaque voluntary carbon markets, it can hardly be a surprise that leveraging crypto rails to bring more transparency to the entire supply chain of carbon offsets — from project finance, to project execution, methodologies for measuring the emissions reductions, the certification process of the offsets, the marketplace for buying and selling and retiring carbon offsets — has become a major focus area for the ReFi community.
In a recent post I introduced a new visual model called the ReFi Climate Stack which highlights examples of ReFi projects across the crypto stack.
The ReFi Climate Stack has an entire layer dedicated to the decentralization, tokenization and transparency efforts being used for carbon offsets and other eco-credit schemes (e.g. renewable energy credits).
What many ReFi projects have in common, in one form or another is the idea of Proof of Impact. Given the rampant greenwashing we see from corporations around the world making bold, unsupported claims, there is real need to inject transparency into claims of impact. Many global actors are calling for on-chain tools for the digital measurement, reporting and verification (dMRV) of ESG impact claims. The team and community at Toucan Protocol are big believers and advocates for accelerating the adoption of DMRV on crypto rails.
Meanwhile, Atlantis DAO has a proof of impact feature that allows individuals to help corporations achieve their impact goals via bounties which are then tracked and rewarded on chain.
While thinking about what we are trying to achieve with WheelCoin, the Move2Earn/Impact2Earn app that rewards users for their green mobility choices, I have increasingly been thinking about the $WHL reward token as a type of Proof of Human Impact. $WHL will soon be on-chain, thus allowing part of the impact journey by individuals (and employees) to become more transparent.
While we are limited in how much of the indivdual’s mobility patterns can be on chain due to obvious privacy concerns, I do hope over time we can bring some data on chain that provides further evidence of the aggregate and anonymized journeys our growing user base is creating as a type of Proof of Human Impact. If you have any suggestions on how to further provide on chain evidence of the green impact our users have we would love to hear it. In the meantime, we will focus on our major north star: increasing the emissions of WheelCoin ($WHL) which can only be earned by users moving greener than if they were in a normal combustion engine vehicle.
I am also wondering about the potential to somehow create a collective metric for the entire ReFi space. Could we create some kind of dashboard that aggregates on chain evidence of impact from every ReFi project?
Conclusion
The ReFi space is poised for a breakout in 2023. The perfect storm of growing concerns around climate, growing focus on companies to have clear and transparent ESG goals and actions, global residents seeking ways to be part of the solution and the birth of great blockchain protocols to build ReFi projects on, there is no time like the present to buidl in the bear market. Increasingly Proof of Impact will be on chain and the ReFi space will power this next wave of impact innovation. At Iomob, the makers of WheelCoin, we are glad to play a small part in the ReFi community.
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