Toco (tonnes of carbon) is a new digital currency that emphasises the inherent value of the natural environment as an economic asset through carbon offsetting. A single toco represents one tonne of carbon dioxide that has been credibly removed from the atmosphere, as it aims to generate environmental wealth from economic growth .
Toco was founded by Neil Schoeman, Johan Pretorius and Paul Rowett, and launched in Stellenbosch in February of this year. Toco hopes to affect climate action through a new way of thinking about money and its value. “[When] I look at the younger generation, something tells me there’s a burning desire to change, to evolve. There’s a frustration with the system they’ve been born into, the system they’ve inherited”, says Rowett, the CEO of Toco, who is also heading up the initiative in Stellenbosch. He is talking about anger felt by young people, especially climate activists.
He further says, “Let’s think about this differently…Capitalism is not going away and we’re not going to find a system of value that’s going to replace capitalism in the next 40 years, and by then it’s too late. Let’s be pragmatic. Let’s find a solution that fits within capitalism and that values the natural world as an asset within the capitalist construct, so that we can make change quickly.”
“We [found] something that people do every day and we [found] something that anyone can access, no matter where you are in the world. Currency ticks those boxes. We all buy something every day, whether it’s one cup of coffee, a loaf of bread or a car. Money is a service – it allows us to exchange value…”, Rowett explains.
The Carbon Reserve, an independent NPO based in Switzerland, centrally holds and owns carbon mitigation assets. These are exchangeable from Rands to tocos, the unit of currency on the toco payment platform app. Carbon mitigation assets refer to credible carbon offset certificates (carbon credits) issued at the verifiable permanent removal of carbon dioxide from the atmosphere.
Carbon mitigation is done through a variety of methods, such as reforestation, soil sequestration and carbon capture. Thus, a toco functions as a carbon credit, with monetary value. Toco aims to create greater demand for carbon offsetting, thus expanding the voluntary carbon market and increasing the value of carbon credits.
“Whatever the thing is that gives money its value, in terms of the unit of extraction, gets huge demand…[The] underlying asset of CO2 removal is the natural world… It’s a way of creating this asset class, called environmental wealth”, says Rowett, explaining that toco functions much like the gold standard and that their goal is to create a goldrush on the carbon market. This will increase the demand for carbon removal.
Toco works as any other currency, with an exchange rate of about R180 at the time of publication, and is stored on the toco app in a digital wallet. These tocos can be used to pay for goods and services at businesses in and around Stellenbosch that offer the payment option, as well as saving and trading, at a 1% transaction fee.
Using blockchain technology, toco aims to be completely as transparent as possible by making information available on the “quality and quantity of the carbon credits held in The Carbon Reserve” on its blockchain register. Each user on the toco network also undergoes identity verification by providing ID and proof of address, eliminating anonymous transactions and differentiating, as well as distancing, itself from other cryptocurrencies and its potential hazards.
“We’ve been through all the compliance checks, we’ve been through the government checks. We’re about to become a regular FSP (Financial Service Provider) when the window opens in June. We comply with all traditional finance [regulations]…[Toco] is not a fly-by-night operation”, Rowett explains.
Rowett continues, “We’re not doing this as some sort of profit-seeking initiative. The founders behind this are doing this because of purpose.We’ve given humans, citizens of the world, the opportunity to create an immense impact with not a lot of friction.”
“I’m not philosophical in my beliefs, but I certainly believe degrading the natural world is not the way to go. When this really crystallised for me was when I looked at my [newborn] daughter for the first time, and the weight of the reality of things dropped for me. My purpose is not for me anymore, it’s for her future and the lives of other kids and the world that we leave behind for them”, Rowett shares.
Toco can even be used in the Neelsie Student Centre. Jeff’s Place, Jack’s Bagels, Nca’Kos and Toast are all toco merchants. EnRoute and Panda also accept payment in tocos. The list of toco merchants are available on the Toco webpage.
Check out toco’s Instagram @tococurrency or explore their webpage www.tocos.org