If the piece on tokenized carbon gave the overview, here we go deeper into the regulatory framework, because, in serious tokenization, the legal framing is not a detail: it is what separates a legitimate asset from a label.
The model: cap-and-trade
Law 15,042/2024 (enacted on December 12, 2024) establishes the Brazilian Emissions Trading System (SBCE). The design is cap-and-trade:
- Cap (ceiling): the government sets a total emissions limit for the regulated sectors.
- Trade: those who emit less than their quota can sell the surplus; those who emit more must buy. The carbon price emerges from this negotiation.
The compliance instrument is the CRVE (Brazilian Emissions Quota): 1 unit = 1 tCO₂e, fungible and tradable. It is the asset that a regulated agent delivers to prove compliance.
CRVE × voluntary credit
Do not confuse the two assets:
- CRVE: arises from the regulated market, within the SBCE, to fulfill a legal compliance obligation.
- Voluntary credit: arises from projects certified by private standards (Verra, Gold Standard), bought by choice, not by obligation.
The law provides for bridges between the two worlds, but the legal nature is distinct, and that changes how each can be structured and tokenized.
Gradual implementation
The SBCE does not come into force all at once. The law provides for five phases of implementation, from regulation and the emissions inventory to the full operation of the market with binding targets. In practice: the framework exists, and the operation is built in stages over the coming years.
Source: Law 15,042/2024 (Planalto) and official disclosure by the Federal Senate. This text is informational, describes the public framework, and does not constitute legal guidance nor an offer of any asset.
Why this matters for tokenization
An on-chain carbon credit is only trustworthy if the legal layer beneath it is solid. With the SBCE, Brazil now has a regulated carbon asset, and tokenization can give it the origin-and-retirement traceability the market has always demanded. It is the same discipline we apply under CVM 88 / 175 for securities, now applied to the environmental framework.
Want to structure or tokenize carbon assets under this framework? Talk to us.
Notice
Forward Factory is an infrastructure platform for asset tokenization and does not provide investment advice, recommendations or counseling. The solutions described here do not constitute a public offering of securities. When a token represents a security, it observes the corresponding regulation, and the structuring of issuances adopts know-your-customer and anti-money-laundering (KYC/AML) procedures. Any offerings observe the applicable regulation of the Brazilian Securities and Exchange Commission (CVM), including CVM Resolutions No. 88 and No. 175. Past performance is no guarantee of future results; investments involve risk.