Carbon Credits

Definition ∞ Carbon Credits are tradable permits representing the right to emit a specific amount of greenhouse gases. They are used in cap-and-trade systems to incentivize reductions in emissions. Each credit typically corresponds to one metric ton of carbon dioxide equivalent.
Context ∞ Discussions around Carbon Credits in crypto news often relate to their tokenization on blockchains, creating new markets for environmental assets. This integration aims to improve transparency, liquidity, and accessibility for carbon offset projects, sparking debate about their efficacy in combating climate change and the potential for greenwashing.