Digital Asset partners to support commodities ESG

A digital marketplace for environmental, social and governance commodities has boosted its partnership with distributed ledger firm Digital Asset to offer clients greater certainty over the ESG credentials of the commodities they are handling.

Xpansiv said on Tuesday it has reached agreement with New York-based Digital Asset to use its Daml system to upgrade the ESG commodities market's platform to support a distributed ledger-based immutable record of production.

The partners said this will offer consumers interested in ESG a single record of their commodities’ provenance, enabling them to fulfill their ESG commitments with confidence.

Xpansiv chief executive Joe Madden said: “We have applied our core-competency in ESG and commodity-market infrastructure to prove what’s possible, drive liquidity, and build relationships with established market participants. Now it’s time to scale, which requires process standardization and interoperability.”

This latest agreement builds on a partnership that saw the firms deliver late last year a Daml-driven prototype for creating next-generation, ESG-tradable assets.

Yuval Rooz, Digital Asset Co-founder and CEO, added: "Using Daml to underpin the infrastructure for new data-driven, ESG-inclusive assets—like methane performance, GHG intensity, and carbon-removal products—will drive liquidity and enable these new markets to flourish.”

Rooz founded Digital Asset in 2014 with Sunil Hirani, the former founder and chief of broker Creditex, Don Wilson, the founder and head of trading firm DRW Holdings.

Rooz became the firm’s chief executive after the departure in late 2019 of founding Digital Asset head Blythe Masters, JP Morgan’s former head of global commodities who took the helm at Digital Asset in early 2015.

Chief executive of trade body the World Federation of Exchanges Nandini Sukumar said last month derivatives will be the focus of the next chapter in the evolution of markets linked to ESG.

BNP Paribas bolstered in March its ESG service by partnering with sustainability data firm Clarity AI to enable clients to store their fund data on a single platform.