CFTC Proposes Guidance for Voluntary Carbon Credit Trading

The move aims to increase transparency and integrity in the voluntary carbon market, amid concerns about quality and double counting.

The U.S. Commodity Futures Trading Commission (CFTC) has proposed guidance for companies seeking to list voluntary carbon credits for trading, aiming to increase oversight and transparency in these markets.
The CFTC's proposal outlines expectations for quality standards, delivery points, and inspection provisions for any voluntary carbon credits, and calls for contracts that are not readily susceptible to manipulation.
Treasury Secretary Janet Yellen has described the plan as an important step towards promoting the integrity of carbon credits and enabling greater liquidity, price discovery, and responsible product innovation.
The International Organization of Securities Commissions (IOSCO) has also launched a consultation on standards for voluntary carbon markets, identifying potential vulnerabilities and proposing a set of 21 Good Practices.
The proposed regulations come in response to concerns about the lack of oversight and transparency in the voluntary carbon market, as well as issues of double counting and the quality of carbon credits.