Forest Preservation Token

 
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We develop a digital model where financing processes for climate protection measures can be implemented more transparently and tangibly, and by actively involving the civil society (crowd). For this purpose, we want to develop the “Forest Preservation Token (FPT)” – an incentive-based system that focuses on the conservation of natural reservoirs, especially forests, and their sustainable management. Its purpose is to align financing decisions with sustainability aspects (ESG criteria) and stimulate a change in the behavior of all stakeholders involved. In our view, this forms the basis for effective and sustainable climate protection, which should be seen as a societal challenge.

 
 

The proposed system provides a way to incentivize landowners to preserve the existing forest on their land because they will get paid for not cutting off the trees. We do this by virtually chunking the forest surface in square meters, associating unique tokens to it (tokenizing the forest surface), and distributing them (direct sale through crowdsale or association with a product sale). The end customer gets the opportunity to be a “custodian” for small pieces of forest, which are uniquely identified and independently checked. The value associated with the token goes directly and transparently to the landowners but depends on the forest’s condition.

 
 
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 What is the value proposition of this system? It scales through crowdfunding with the direct involvement of the civil society in forest protection and establishes a way to reach a personal level of involvement (gamification) for the individual – you are custodian, you can identify “your” square meter(s), collect them, build up a “portfolio” of surfaces you protect. We can use this scientifically-backed system to scale and reach new markets by associating tokens with other products or new customers (e.g., “currently not-involved” people) by simplifying the way they can pay for forest custody.

We use blockchain technology to implement this system. The use of blockchain technology addresses the need for a trusted system for value transfer and increases the level of trust in verifications of the forest conditions. We also associate value transfer with trustful information on-site. The need for transparency and audibility is secured by implementing the uniqueness of a token (NFT). We plan to implement the system using a blockchain infrastructure that has a low energy consumption and a very low carbon footprint, using a consortium setup or a proof-of-stake platform, without using energy-intensive mining like proof-of-work (e.g., bitcoin) consensus.

 

Project partners

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dCentra GmbH, as a digital innovator and technology service provider, enables with its platforms and technical know-how the development of novel business models through digital, cross-organizational, and automated collaboration in the domain of sustainable development.

The Fraunhofer Center for International Management and Knowledge Economy IMW brings to the project scientific excellence in the socio-economic field with a focus on alternative finance and crowd innovation. It enriches the consortium with national and international contacts and excellent access to data. In addition, the Fraunhofer IMW is characterized by a high level of project experience with studies for public clients.

Trier University has a vast background in setting up conducting impactful research in entrepreneurial finance, especially in sustainable finance, crowdfunding, and ICOs using different qualitative and quantitative research methods such as conjoint experiments. With a vast network of academic partners, Trier University will take the lead in publishing and disseminating the scientific project outputs.