Cryptocurrency
How blockchain tech and dMRV can help carbon trading markets
There is a global consensus that greenhouse gas (GHG) emissions are warming the planet, but efforts to accurately measure, report and verify these emissions continue to challenge researchers, nonprofits, corporations and governments.
This is especially the case with “nature-based” projects to reduce carbon dioxide levels, like planting trees or restoring mangrove forests.
This has inhibited the development of a voluntary carbon market (VCM) on which carbon offset credits are traded. These “offsets” are sometimes viewed as licenses to pollute, but VCMs overall are thought to be beneficial to the planet because they help quantify the environmental impact of industrial and consumer activities and, at least indirectly, motivate companies to curb emissions.
However, VCMs have recently come under intense criticism. A nine-month investigation by the United Kingdom’s Guardian newspaper and several other organizations found that more than 90% of “rainforest offset credits” approved by the leading certification firm Verra “are likely to be ‘phantom credits’ and do not represent genuine carbon reductions.”
This finding shook the carbon trading sector, but it has also spurred some new thinking about ways to measure, report or verify the efficacy of carbon-reduction projects. Digital monitoring, reporting and verification (dMRV), for example, largely automates this process, making use of new technologies like remote sensing, satellite imagery and machine learning. DMRV also uses blockchain technology for traceability, security, transparency and other purposes.
All this is still new, but many believe dMRV can reinvigorate carbon markets following the Verra scandal. It can also compensate for a shortfall of human auditors and inspectors available globally to assess GHG projects, especially the more problematic “nature-based” projects. In addition, it can gather a broader range of data and potentially make it available in real time. Importantly, it will allow a global comparison of projects for the first time.
“A huge difference”
“DMRV will make a huge difference here, since it moves the quantitative comparison of various nature-based interventions onto a global field where they can be comparable with each other — something that is not possible in the current systems as projects self-report against their own baselines,” Anil Madhavapeddy, a professor at the University of Cambridge and director of the Cambridge Centre for Carbon Credits, told Cointelegraph.
Some go even further. “Digital Measurement, Reporting, and Verification (dMRV) technology has the potential to revolutionize the way the voluntary carbon market (VCM) operates,” declared dClimate, a decentralized infrastructure network for climate data, in a March blog post.
Still, questions remain: Maybe this is all too little, too late for averting climate change? And if not too late, won’t progress stall if better methodologies aren’t developed, like quantifying how much a Brazilian rainforest reduces global carbon? Are blockchains necessary for the process, and if so, why? And can dMRV really “revolutionize” voluntary carbon markets, or is this just excessive hyperbole?
“It is not too late,” Miles Austin, CEO of climate tech firm Hyphen Global AG, told Cointelegraph. “We find ourselves at a pivotal moment.” The Verra scandal and continued allegations of “greenwashing” on the part of corporations have made more companies leery of supporting carbon-reduction projects.
“The perceptions of trust and feasibility associated with nature-based assets, both within the public and private sectors, have been adversely affected,” Austin noted. But he added that at this critical juncture:
“DMRV can have a significant impact to not only improve these markets but save them.”
It might be helpful to compare dMRV with traditional MRV, which aims to help prove that an activity — like planting trees or scrubbing smokestack emissions — has actually occurred. It is a prerequisite before a monetary value can be attached to the activity, and a necessity for carbon trading markets to work.
MRV has been “underpinning” sustainability reporting for years, Anna Lerner Nesbitt, CEO of the Climate Collective, told Cointelegraph. However, “it has a lot of weaknesses,” including a high reliance on subjective data, steep costs, lengthy timelines and a dependence on “international experts” — i.e., consultants.
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According to Cambridge Centre’s Madhavapeddy, the inherent difficulty with quantifying nature-based projects “is that the conventional mechanisms for doing so — over the past decades — have been very manual and hard to compare across projects.”
Quantification mechanisms used for these assessments are far from being standardized. They include assessing “additionality” (i.e., what’s the net difference climatewise of a project?), permanence (how long will its effects last?), and leakage (did a negative externality, like cutting down a forest, just move somewhere else?).
DMRV, said Nesbitt, relies on emerging technologies and more granular data for “a fully digitized MRV protocol that not only collects digital data via Internet of Things, sensors and digital technologies but also processes and stores data on a fully digital and decentralized blockchain ledger.”
DMRV can also potentially reduce the workload of auditors and inspectors called upon to validate emissions-reduction projects, according to Daniel Voyce, chief technology officer of sustainability-focused solutions provider Tymlez, who wrote:
“With manual MRV recording each auditor or inspector might only be able to verify 150 projects each year due to chasing down the data they need and having to collate it all.”
Digitizing the process could reduce time and costs by 75%, he estimated.
Can blockchain help fix a “convoluted” process?
What role, if any, does blockchain play in all this? “I think if we are being honest, voluntary carbon markets — and regulated carbon markets — need blockchain for asset issuance and traceability,” Michael Kelly, co-founder and chief product officer at Open Forest Protocol — an open platform for scaling nature-based solutions — told Cointelegraph.
The current MRV process is “convoluted,” he said, with “no visibility into issuance schedules, no traceability, quite frequent double-spending, etc.” As a result, “people are hesitant to touch carbon credits.”
DMRV combined with blockchain could change things. “Once they can see everything about it [a project] — down to the upload of each tree in a sample plot for a 20-year time period — we will see new participants coming into the arena.”
Some incremental improvements in MRV — like digitizing submission forms — don’t really need blockchain tech, noted Nesbitt, but that might soon change with the addition of “features like smart contracts that allow for more inclusive or just asset pricing, baking in a reasonable compensation for local communities involved in carbon credit projects.”
However, there may be limits on how much blockchain tech alone can fix things. Blockchains can enable “transparency, security, automation and immutable records of data flows in an auditable fashion,” but that might not be enough, suggested Hyphen’s Austin, adding:
“DMRV can only be as good as the data and methodology used. If you take a flawed methodology and digitize it with blockchain, you now have an immutable and transparently flawed dMRV.”
Improving methodologies is crucial in Austin’s view. “Activity-based approaches work well in the case of combustion engines or industrial processes, which you can accurately measure and multiply by a factor,” he told Cointelegraph.
But these don’t really work on “nature-based solutions.” A forest in Brazil may sequester more carbon dioxide than an equally sized forest in Indonesia based on many variables, including drought, rainfall and humidity, for example.
“Nature is a breathing and living asset; therefore, methodologies need to measure the actual amount of CO2/CO2e [carbon dioxide/carbon dioxide equivalent] that is a sink or source instead of calculating a best guess,” said Austin.
Work is being done in this area, especially in the wake of the Verra controversy. “Researchers in this field are showing how the quality of ‘avoided deforestation’ carbon credits could be improved,” Julia Jones, professor in conservation science at Bangor University, told Cointelegraph. “However, there is, of course, some lag between new research and it getting into policy and practice.”
The Cambridge Center for Carbon Credits actually built a research prototype last year of what a carbon credits marketplace might look like on the Tezos blockchain. “Our first observation was that the blockchain really wasn’t the bottleneck here — all of that infrastructure works fine and has a solid technical roadmap for scaling,” Madhavapeddy told Cointelegraph. The barrier lay elsewhere.
“The blocker to any meaningful deployment came from the lack of supply of credible projects, since the quantification mechanisms” — i.e., additionality, permanence and leakage — “are only just maturing as satellite infrastructure and the associated algorithms are peer-reviewed and deployed.”
Kelly also cited a shortage of “quality carbon development projects and accessible credits,” especially in the nature-based asset subsector, as a significant obstacle for VCMs.
Projects like reforestation, afforestation, mangrove restoration and biodiversity conservation are now short of funding. This project shortfall leads to a low supply of credits, which becomes a sort of chicken-and-egg problem.
“The result of this system is that carbon credits remain a relatively illiquid, convoluted and difficult-to-scale system that disincentivizes stakeholders from financing, purchasing and trading the assets to participate in the market,” said Kelly.
“The biggest barrier right now is the collective credibility of the voluntary markets, and we hope that our work on the digitization and systematic design and publishing of analyses can help bridge that gap,” said Madhavapeddy.
A “perfect storm”?
What about claims, like those cited above, that dMRV technology has the potential to revolutionize the way the voluntary carbon market operates? Is that going too far?
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“DMRV is at the center of strengthening data integrity, which in turn would improve process integrity,” said Nesbitt. “So yes, I think dMRV is vital to set up the voluntary carbon market for success. But saying it will revolutionize the market might be taking it a bit too far given the many dMRV improvements and applications already in implementation.”
Kelly sees two promising trends in the wake of the Guardian expose. Legacy incumbents like Verra and Gold Standard are now more intent on digitizing their processes and “becoming more transparent and trustworthy,” he said, while “stakeholders are more willing to try new solutions, or service providers, especially if they have higher standards for trust, visibility and quality.”
The result could be a “perfect storm for catalyzing a liquid voluntary carbon market — on-chain,” he added.
TL;DR
- Ripple CEO to testify as lawmakers debate XRP’s future under SEC or CFTC oversight.
- The asset token forms a bullish inverse head-and-shoulders pattern with analysts predicting a 12% breakout.
- Court denies Ripple-SEC settlement; Senate hearing and Crypto Week may shape XRP’s classification.
Garlinghouse Will Testify Before the Senate
Ripple CEO Brad Garlinghouse is set to testify before the Senate Banking Committee on July 9. The hearing, titled “From Wall Street to Web3: Building Tomorrow’s Digital Asset Markets,” will explore how digital assets are traded and regulated in the United States.
Garlinghouse confirmed his participation via X, stating he would speak on the need to pass legislation that defines crypto market structure. He will feature along with Summer Mersinger of Blockchain Association, Chainalysis co-founder Jonathan Levin, and Paradigm partner Dan Robinson. Lawmakers are expected to revisit key questions about oversight, including whether assets like XRP fall under the CFTC or SEC.
I am honored to be invited to testify in front of the Senate Banking Committee this Wednesday on the need for passing crypto market structure legislation. Thank you to @BankingGOP Chairman @SenatorTimScott, @SenLummis and @SenRubenGallego (as leaders of the Subcommittee for…
— Brad Garlinghouse (@bgarlinghouse) July 7, 2025
XRP Breakout Signals 12% Surge
XRP’s price jumped to $2.35 between July 7 and 8 after a sharp rise in trading volume. More than 182 million XRP traded hands during the rally. The price later settled around $2.26, reflecting a slight 0.3% dip in the past 24 hours.
Despite the retreat, crypto analyst Ali Martinez said on X,
“$XRP is breaking out!”
He noted that the token has formed an inverse head-and-shoulders pattern, often viewed as a bullish signal. Martinez said that this setup could lead to a 12% upside in the short term.
$XRP is breaking out! pic.twitter.com/y5S8LdYgXG
— Ali (@ali_charts) July 7, 2025
Meanwhile, traders are watching closely ahead of the Senate hearing. Some expect clearer legal definitions to emerge around XRP’s status. Support for the CLARITY bill, which aims to define regulatory boundaries for digital tokens, could shape how XRP is treated going forward.
Ripple-SEC Case Nears Final Chapter
Garlinghouse’s appearance follows Ripple’s recent decision to withdraw its cross-appeal in its legal case with the SEC. The decision came after Judge Analisa Torres ruled that XRP sales on secondary markets were not unregistered securities. A $125 million penalty tied to earlier sales remains in place.
Both Ripple and the SEC filed a motion to end the case and reduce penalties, but the court denied it. Judge Torres said only the court can revise a ruling. The SEC has not yet confirmed if it will drop its own appeal.
Upcoming Crypto Week May Drive Policy Shift
In addition, the Senate hearing sets the tone for the House’s “Crypto Week,” which begins July 14. Lawmakers will discuss three bills: one on stablecoins, one on market structure, and one addressing central bank digital currencies.
The market structure bill, known as CLARITY, could define how crypto assets are regulated. Ripple may benefit if XRP is officially treated as a commodity. That would put it under CFTC rules and remove lingering questions about its classification.
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Ask anyone familiar with blockchain what the biggest drawbacks to the technology are: while some specific answers might vary here and there, you’ll likely find that security and privacy concerns are always high on the list, often accompanied by questions about the technology’s speed and the regulation around it.
Then why even use blockchain, if you can’t entirely trust it? After all, you’ve been managing things like finance, governance, and more without blockchain for a long time before this technology came along. What has certainly changed is the growing need for users and consumers, as well as companies and organizations, to receive adequate guarantees that the services they require are provided securely.
Transparency VS Confidentiality?
Blockchain networks are fundamentally transparent, and the fact that everything onchain is public is widely considered positive, especially when it comes to verify transactions. The downside, of course, is that all the key information about the transactions are also available, including data that you’d rather not disclose. This is where the ongoing dilemma plaguing a more widespread implementation of blockchain technology comes in: keeping transactions private prevents verifiability, but without the ability to verify the transactions the lack of transparency exposes users to uncomfortable scenarios.
The line between transparency and confidentiality becomes even more blurred when building decentralized applications (dapps). Today, all transaction details — including balances, transfer amounts, and contract states — are publicly visible onchain; this makes blockchain unusable for many institutional and consumer applications requiring privacy, which is the standard in the world of finance.
The lack of confidentiality is a big obstacle to the mass adoption of dapps, which is crucially the next frontier for blockchain. The past few years have seen a big focus on building stable infrastructures: now it’s time to build upon those infrastructures and create applications that can realise the full potential of blockchain. The key to unlocking this potential is a solution that combines the best of both worlds, shifting the conversation from “transparency VS confidentiality” to “transparency + confidentiality”, as the web did when moving from HTTP to HTTPS.
Solving the dilemma: the Zama Confidential Blockchain Protocol
Transparency, while foundational to consensus, comes at the cost of privacy. It is with the intention to overcome this problem that Zama’s team has been working tirelessly for the past couple of years. An open-source cryptography company building state-of-the-art FHE solutions for blockchain, Zama has long identified Fully Homomorphic Encryption (FHE) – a technology that enables processing data without decrypting it – as the groundbreaking technique that can change the way users, businesses and organizations think about privacy.
From the start, blockchain seemed the perfect environment to dive into and develop the full potential of FHE, a long and complex exploration culminating with the launch of the Zama Confidential Blockchain Protocol.
The Zama Protocol resolves the longstanding tension between transparency and confidentiality onchain. Combining FHE coprocessors, threshold Multi-Party Computation (MPC), and Zero-Knowledge Proofs (ZKPs), the protocol enables private computation in public environments.
This is the most complete confidentiality protocol to date, allowing developers to code fully confidential smart contracts using familiar tools like Solidity without modifying the underlying blockchain by offering a few key elements:
- End-to-end encryption of transaction inputs and state
- Composability between confidential contracts, as well as with non-confidential ones
- Programmable privacy, with smart contracts defining who can decrypt what, making it easy to build dapps that comply with regulations globally
As outlined in the Zama Protocol Litepaper, the protocol introduces a novel cross-chain confidentiality layer that can operate on top of existing blockchains. With these characteristics, the Zama Protocol enables confidential smart contracts to run seamlessly across any Layer 1 or Layer 2 network, extending privacy guarantees without altering the underlying infrastructure.
Beyond FHE
The Zama Protocol heavily leverages the ability to securely compute directly on encrypted data. For this reason, FHE has long been considered the “holy grail” of cryptography, despite slow speed and limitations to ease of use: this is why Zama’s team has worked to deliver a technology that can support any type of application, using common programming languages such as Solidity and Python, while being over 100x faster than a few years ago.
With the goal to create a game-changing comprehensive protocol meeting all the requirements to deliver a fully confidential blockchain, the team worked outside the familiar confines of FHE. As the main component powering the protocol, Zama’s library FHEVM makes it possible to run confidential smart contracts on encrypted data: combining this with MPC to ensure secure collaboration and ZK for verifiability, Zama looks to overcome the main shortcomings of each individual solution.
Unlocking new possibilities
One of the main motivations behind Zama’s dedication to this project is the growing demand for privacy-preserving primitives in blockchain. Whilst there is an increasing interest for solutions from confidential token transfers to stablecoins, from private DeFi to privacy-preserving identity and compliance, none of these can currently be safely deployed on public chains without confidentiality guarantees.
- Finance & Banking: Secure transaction processing, risk modeling, and confidential onchain payments, making blockchain technology suitable for financial institutions.
- Confidential DeFi: Private smart contracts and dapps apps that fully protect user data.
- FHE State OS & Network States: Strong confidentiality for onchain communities and network states, supporting democratic governance while protecting sensitive information.
- End-to-End Encrypted Transactions & State: All data in transactions is encrypted and never exposed, ensuring complete confidentiality.
- Onchain Composability & Data Availability: Smart contract states are continuously updated while remaining fully encrypted, preserving both composability and privacy.
Thanks to this approach, adopters of the Zama Protocol can enjoy all the advantages of the different techniques without limitations: verifiability, decentralization, scalability, composability, security and, crucially, ease of use for developers.
To usher in what aims to be a revolution for onchain privacy with its protocol, Zama has launched a public testnet (read more about it on the official Zama Protocol documentation), providing developers with a ready-to-build foundation for privacy-preserving decentralized applications. This will allow anyone to deploy and test their confidential dapps, as well as enabling operators to coordinate and get used to the operations.
Disclaimer: The above article is sponsored content; it’s written by a third party. CryptoPotato doesn’t endorse or assume responsibility for the content, advertising, products, quality, accuracy, or other materials on this page. Nothing in it should be construed as financial advice. Readers are strongly advised to verify the information independently and carefully before engaging with any company or project mentioned and do their own research. Investing in cryptocurrencies carries a risk of capital loss, and readers are also advised to consult a professional before making any decisions that may or may not be based on the above-sponsored content.
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Bitcoin has slightly lost its bullish steam upon nearing the $111K all-time high, with strong selling pressure emerging at this key level.
The price continues to struggle in reclaiming this threshold, signaling a likely period of consolidation or corrective movement in the days ahead.
Technical Analysis
By ShayanMarkets
The Daily Chart
Bitcoin’s bullish rally toward its all-time high of $111K has shown signs of exhaustion, with the price losing momentum near this key resistance. The inability to reclaim the previous high around $110K suggests the potential formation of a double-top pattern, a classic bearish reversal signal.
Currently, BTC is consolidating within a critical price range, bounded by the $111K ATH and a fair value gap between $103K and $104K. Given the visible weakness in bullish momentum, a short-term rejection and further consolidation within this zone are likely. That said, the FVG may act as a significant demand zone, potentially halting any deeper corrections and providing the base for another upward attempt toward the $111K mark.
The 4-Hour Chart
On the 4-hour timeframe, BTC failed to print a new higher high above $110K, encountering notable rejection at this resistance. This price action confirms the presence of heightened selling pressure and distribution behavior near the ATH zone, reinforcing $111K as a key barrier.
Bitcoin now trades between two prominent liquidity zones: one just below $105K and the other above $110K. These liquidity pools are attractive targets for institutional players and could drive price volatility in the short term. As such, a range-bound movement is expected between these levels until a decisive breakout occurs, likely triggered by a liquidity sweep in either direction.
Sentiment Analysis
By ShayanMarkets
Over the past 45 days, taker users on Binance Derivatives have persistently engaged in sell-side activity. Despite this, Bitcoin has remained range-bound between $100K and $110K, while the Cumulative Volume Delta (CVD) has shown a consistent negative trend throughout the period.
The CVD, which measures the net flow of buy and sell volume in real time, highlights a clear dominance of aggressive selling pressure. However, the price’s ability to hold steady, without further decline, points to a potential absorption phase, likely directed by institutional investors or large-scale players quietly accumulating.
This ongoing divergence between persistent sell-side flow and stable price action suggests that Bitcoin may be forming a strong base. If the current structure holds, with continued absorption within the range, the likelihood of a bullish breakout increases, potentially setting the stage for a renewed uptrend.
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Cryptocurrency charts by TradingView.
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