J.P. Morgan announced on Wednesday that its blockchain unit, Kinexys, is partnering with leading carbon market registries to develop a blockchain-based application aimed at tokenizing carbon credits.
The initiative is being tested by S&P Global Commodity Insights, EcoRegistry, and the International Carbon Registry (ICR), with the goal of increasing transparency, standardization, and efficiency in the voluntary carbon market (VCM).
The application is being built on Kinexys Digital Assets, J.P. Morgan’s multi-asset tokenization platform.
It focuses on enabling registry-layer tokenization of carbon credits, meaning the credits are tracked and managed digitally at their source.
EcoRegistry and ICR have completed initial integration tests, while S&P Global will begin testing its Environmental Registry solution, with future phases possibly including its proprietary Meta Registry.
The testing will focus on managing the full lifecycle of accounts, projects, and credits, and some of the key goals are seamless technical integration, alignment of data models, and end-to-end functionality.
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The VCM currently faces challenges such as fragmented infrastructure, inconsistent data standards, and limited interoperability between registries, J.P. Morgan said.
Kinexys hopes to solve these issues by creating a unified system where carbon credits are digitally portable and verifiable.
The application aims to streamline account, project, and credit lifecycle management while improving connectivity and data compatibility.
“The voluntary carbon market is ripe for innovation,” said Alastair Northway of J.P. Morgan Payments. “Tokenization could support development of a globally interoperable system.”
A new research paper by Kinexys emphasizes that blockchain can provide traceability, immutability, and trust—critical features for scaling the VCM.
However, broader tools such as digital monitoring and connectivity with insurers and ratings agencies will be key to realizing the full potential.
This development follows J.P. Morgan’s 2023 release of its Carbon Markets Principles, which outlined the firm’s strategy for supporting scalable, effective carbon markets.
