Cross border forest financing

by Jaclyn Bolt

Introduction

Considering the combination blockchain technology and forests, Oasebos (transl: oasis forest) was an early bird. Peter Mols, chairman of this Dutch NGO explained to us what got him interested in this technology and shared some of his experiences.  

The forest

Peter was immediately drawn to this rich biodiversity, covering over 5% of all species in the world: Costa Rica. For over 18 years now, Oasebos has been engaged in forest conservation in the Maquenque through land acquisition and subsequently conservation activities. Up until now, Oasebos has safeguarded 300 hectares (with an additional 100 ha underway) of a total of 2,000 hectares they aim to protect in the future for generations to come. The country is friendly towards these types of initiatives, the government proves to be a reliable partner, Oasebos is able to engage local communities, there is public record keeping of land registration, and environmental police forces are active and reliable. Coincidentally, according to Peter, Costa Rica appears to have a bit more blockchain awareness compared to other countries. 

The problem

The blockchain solution of Oasebos does not attribute to a particular problem per se, but was more so sprouted by curiosity. The idea was to protect biodiversity by retracting it from conventional economic transactions. Co-ownership was common practice in the art world and this concept was copied to create borderless co-ownership of forests. This would enable a more advanced form of forest adoption that would be recorded in an agreement, in order to divide the ownership into economic and legal ownership. This made the character of the desired co-ownership both trustworthy en pragmatic in process. Another envisioned added benefit of applying this new technology at the time was to tap into a new group of potential forest adopters. That way, the blockchain hype could be turned into something beneficial for the environment. 

The blockchain solution

The blockchain hype did not truly live up to its expectation. There was ample media coverage, but new forest adopters did not particularly appear. Oasebos has now removed the part where they explain about blockchain from their pitches. But it does work, they have implemented it, and other parties such as a Dutch landscape initiative, have shown interest. Peter: “we still distinguish legal and economic ownership at Oasebos, where the NGO is legal owner and the forest adopter is economic owner with the agreement that the forest should remain as is. It works”.  

Lessons learned

The application of blockchain for forests has been quite challenging for Oasebos. Peter; “an initiative would need support and sponsorship. In the end someone needs to believe in the idea and be willing to pay for it. The realm of nature conservation tends to be conservative. Within governmental organisations, decision making and adoption of new technology can be quite dreadful”.

According to Peter, most people tend to be interested to hear what this new technology can bring, but it is difficult for them to grasp the possibilities and added benefits that immutability can bring. Peter: ”These initial enthusiasts generally stop engaging over time, and more tech savvy people tend to approach blockchain technology with a heavy dose of scepticism which significantly hampers decision making processes. The functional side of blockchain still needs to land so to say. Honestly, I expected blockchain and proving authenticity of data to take off in these times of fake news and understanding what is real. Apparently, it needs more time”.