Climate Impact X (CIX), a carbon exchange and marketplace based in Singapore, announced it will launch a nature-based standardized contract in CIX Exchange, its upcoming spot trading platform.
The platform will trade under the contract code CNX and is designed to tackle concerns in the voluntary carbon market related to project delivery risk, market-representative pricing, and fragmented liquidity.
In a press release, CIX said the contract, named Nature X, will deliver “a market-driven price benchmark, with enhanced transparency benefitting the industry at large.”
At the start, Nature X features 11 global CO2 credit projects that support the decrease of emissions from deforestation and forest degradation, as well as sustainable forest management, and forest CO2 stocks (also known as REDD+).
The projects come from the Americas, Africa, and Asia and account for about two-thirds of the entire REDD+ market volume.
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Nature X will feature four tradable contracts at launch, each representing CO2 credit vintages over a fixed period from 2016 to 2022.
Each lot of CNX equals 1,000 CO2 credits, with each credit representing one metric ton of reduced or avoided CO2 from the verified projects.
Julien Hall, pricing director at CIX, said the company is introducing a more fungible spot contract that mitigates risk and allows for accurate transactions.
“Bids, offers and trades of the Nature X contract by core market participants in a concentrated daily trading session will shine a clear light on market value,” he also said. “This nexus of price formation and liquidity will underpin a robust and representative nature-based spot benchmark, which should build confidence in fairly-priced project differentials, forward contracts, and ultimately futures.”
Climate Impact X was founded by DBS Bank, Singapore Exchange Group, Standard Chartered, and Temasek.
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