Some thoughts:
PROS:
Creating the token off the blockchain is the easy part.
A carbon dollar will be internationally acceptable.
Value is in tons of sequestered carbon, the more tons sequestered, the more money there is.
Sequestered Carbon is a natural resource akin to oil reserves.
In a sense a Carbon credit is a Proof of Work. (Bitcoin model) Whereas Bitcoin PoW requires energy/electricity as its input, this model can work on tons of sequestered carbon.
How reach consensus and solve Byzantine Generals problem.
Ties in with the ESG thrust (https://www.investopedia.com/terms/e/environmental-social-and-governance-esg-criteria.asp)
According to the UN Sustainable Development goals (https://sdgs.un.org/goals)
Challenges:
- ensure the credits are locked to the blockchain, or burnt at token issuance
- Issuance via an exchange
- Where does the blockchain reside
- PoS blockchain
- Banks as nodes
- Secure enough credits to cover Money Supply
- Legal tender
- Extractive industries to buy credits to offset
How to create the credits?
1/Public:
Hydro
National reserves and parks
2/Private:
Solar
Energy efficient stoves
Tree planting
Litter
Plastics and tyres
Regen ag