Chapter 15 Abstract
A central problem of the climate crisis is a need to mobilize sufficient climate finance to generate a low-carbon transition, and to do so quickly enough to prevent dangerous anthropogenic interference with the climate system. In response to this challenge, a case is presented for a coordinated central bank policy that involves a Central Bank Digital Currency (CBDC) for rewarding climate mitigation actions. Justification for the CBDC is framed on a new model for costing externalities and pricing systemic risk. A hypothetical 100-year storyline, called “Avoiding Catastrophe,” is presented to illustrate how the CBDC could be used to mobilize trillions of dollars of new climate finance and manage climate risk. Effectiveness of the CBDC reward is appraised by comparing the 100-year storyline with a speech given by Mark Carney—the Governor of the Bank of England—titled “Resolving the climate paradox.” A technical brief is provided for a CBDC platform, including recommendations for Blockchain ledgers, smart contracts, rules, and strategies for ensuring accountability and scalability.
You may find this chapter in Transforming Climate Finance and Green Investment with Blockchains
Dr. Delton Chen is currently writing a five part article for the MAHB about the Silver Gun Hypothesis: New Model for a Sustainable Carbon Economy. The introduction to the five-part article is available on the MAHB website here.
If you would like to know how The Silver Gun Hypothesis should be used to address climate change and manage the economy, you may read more in Dr. Chen’s recently published chapter. This is the world’s first book on blockchains and climate finance, and the book was launched at COP23 in Bonn and has been on sale since 1 July 2018.
Dr. Chen’s chapter (Chapter 15) is titled Central Banks and Blockchains: The Case for Managing Climate Risk with a Positive Carbon Price. In this chapter, Dr. Chen explains how a second missing externalized cost, called the Risk Cost of Carbon (RCC), should be internalized into the economy using a Global Carbon Reward. Dr. Chen explains how the Global Carbon Reward can be managed with monetary policy and currency trading. The approach is designed to address climate systemic risk and overcome paradoxes in climate finance. He also explains how to implement the policy using blockchain technologies.
For those who may find it difficult to purchase the book, contact Dr. Chen for a copy of his manuscript.
Key Features of the entire Book
- Provides an authoritative examination of this emerging digital technology and its implications on global climate change governance
- Includes detailed proposals and thorough discussions of implementation issues that are specific to green economy sectors
- Relates innovative proposals to existing applications to demonstrate the value add of blockchain technology
- Covers blockchain for the smarter energy sector, for fraud-free emissions management, to streamline climate investments, and legal frameworks for blockchain-based climate finance
For more information on the COP23 discussion about blockchains and the book, visit Ecology Exchange.