5-5 Uncertainty in environmental value creation

When a Regenerative NFT is issued before the actual creation of environmental value such as J-Credits, the environmental value will be reflected in the Regenerative NFT once it's generated. However, for credits anticipated to offset 1000 tons of CO2, there's a possibility, based on monitoring results, that the amount of credits generated might be more or less than originally expected.

In such instances, the amount of credits held in a user's Regenerative NFT will adjust according to the ratio of actual generation to the anticipated amount. Any decimal values in the held amount will be rounded down. Below are some specific examples for clarification.

(Example)

A project was established on SINRA to generate carbon credits equivalent to 1000tCO2 in a particular region, and they sold Regenerative NFTs.

Mr. A purchased a Regenerative NFT representing 5tCO2. At the time of purchase, the carbon credits had not yet been generated. A year later, upon monitoring whether 1000tCO2 worth of carbon credits had been produced, only 900tCO2 of carbon credits were certified.

In the aforementioned case, the entire project produced carbon credits of 900tCO2 against an anticipated 1000tCO2, resulting in a generation of only 90% of the expected volume. Consequently, the carbon credits Mr. A acquired for 5tCO2 will be adjusted to 5 x 90% = 4.5tCO2. Rounded down, this becomes 4tCO2.

In essence, with the realization of environmental value, the carbon credits represented by Mr. A's Regenerative NFT will change from 5tCO2 to 4tCO2.

As illustrated above, if the amount or issuance timing of the carbon credits represented by the Regenerative NFT changes, the stewards of natural resources will provide explanations using appropriate methods. This approach ensures a high level of transparency in our operations.