Simply trading carbon credits on the blockchain won’t do much for the environment. Carbon blockchain executives argue that companies need to understand why they use them and how to make a real impact.

During a panel session in Davos, Switzerland, moderated by Cointelegraph Editor-in-Chief Kristina Lucrezia Cornèr on Jan. 16, several executives from blockchain carbon platforms spoke about the growing interest of companies in carbon trading.

Karen Zapata, COO of carbon blockchain platform ClimateTrade, said sustainability has been a “trending topic” with many companies interested in getting involved, but noted that many still don’t get it.

He recalled speaking to a sustainability manager at a “big, big company” who told him he doesn’t know what a carbon credit is or “how it works” but is being pressured by his marketing team to “move it forward.”

Zapata emphasized that companies will not be able to communicate what they are doing with carbon credits to their community if they “don’t even understand” what it is.

He added that one should be less concerned with the price behind carbon credits and more with the impact. He explained that price takes second place once the positive impact is understood.

Tolam Earth Carbon Market CEO Matthew Porter added to the conversation saying that carbon trading alone “doesn’t solve much”, not knowing why they are doing it and creating “incentives and drivers”.

He also added that putting it on the chain only fixes a “little bit” of inefficiency.

Related: The environmental impact of Blockchain and how it can be used for carbon removal

There has been no shortage of carbon credit developments in the blockchain space of late.

Blockchain-based storage network Filecoin launched Filecoin Green, a protocol labs initiative designed to reduce the environmental impact of its native cryptocurrency, Filecoin, in October 2022.

The first project he launched was CO2.Storage, a Web3 data storage solution that aims to bring transparency for carbon offsets and address traditional storage solutions for all digital environmental assets, including renewable energy credits.

WeWork CEO Adam Neumann dove into the crypto carbon space in May 2022, raising $70 million in the first major funding round for his climate tech company Flowcarbon.

The project was created to make carbon trading more accessible by putting carbon credits on the blockchain.