Waste Validation & Audits

Building trust is the core objective behind the Carrot Protocol’s waste codification and chain of custody tracking protocol. MassIDs offer a reliable mechanism for tracking waste responsibility along the waste supply chain from source to recycling and its reliability is founded on the combination of transparency, validator mechanisms and an understanding of the fundamentals of the waste market that ensure only actual recycled MassIDs end up in a Tokenized Recycling Credit (TRC) or Tokenized Carbon Credit (TCC). While tracking physical waste mass may be impossible, tracking waste responsibility is not. Waste tracking can be done from Point A to Point B, but linking Point A to Point C and beyond, requires a new methodology that waste hauling purchase receipts and transport manifests simply cannot accomplish at scale.

The MassID digital asset offers the link needed to establish Proof-of-Provenance from waste generation source to recycling, where chain of custody is corroborated through Proof-of-Work operations registered in executed service orders and recorded in each MassID. The individual Validator at a Processor executing a material receiving service order is responsible for ensuring data integrity. The Validator’s work is recorded on a blockchain and made available for all to see from the Waste Generator through to the Recycler, as well as to the third party validators and the buyer’s of each TRC or TCC. Each participant pair (Generator < > Hauler, Hauler < > Processor, Processor <> Processor, Processor < > Recycler) is responsible for ensuring that the data which involves them is accurate. Because logistics operations, at the middle and end of the waste supply chain (recorded through Shipment orders between processors) are paid for on a weight basis, the reliability of data becomes very high. The Recycler either purchases materials on a weight basis or charges for recycling services on a weight basis. And, because Recyclers must be accredited by the Carrot Fndn Auditors, the MassIDs that finally reach a Recycler, and which will likely have passed through many validators will, in almost every case, be extremely reliable.

Once MassIDs are able to establish a link between the waste Generator and the Recycler and certified-recycled MassIDs will be tokenized into credits, the demand for waste weighing at the source will grow significantly. This opens the door for new business models, such as Pay-As-You-Throw where a Waste Generator pays for waste hauling and recycling on a weight basis, as is already done in many markets and presented previously in the South Korean Zero Waste business case. Quality waste data at the source and information about actual recycling performance, informs the Waste Generator about its waste footprint, builds awareness, and provides incentive for waste reduction over time. (Note: TRCs and TCCs become a helpful means of also reducing costs associated with waste hauling and recycling costs.)

While Validators along the supply chain play an important role and establish Proof-of-Authority, that authority is ultimately kept in check by the Carrot Fndn Auditors. If an individual or organization tries to game the system, the Auditor can suspend the Participant. A suspension means that MassIDs containing the participant in its chain of custody would be prohibited from being packaged into a TRC or TCC. Every participant associated with the specific MassID would be notified and suffer a financial loss from an unrealized TRC or TCC sale. Auditors can review Processor data, and will ultimately be provided with tools that can be utilized to confirm transactions. Such tools can include waste transfer manifests; receipts from material purchases or services provided; and historical performance data to track variations in waste volumes as well as the time it takes a MassID to travel from source to recycling. (Note: This will be an area of continuous study.)