Financial services solutions provider Delta Capita has launched a new joint venture, DCEM, to deploy a capital markets-grade trading and post-trade platform aimed at solving the trust deficit and liquidity crisis hindering the growth of sovereign environmental markets. The new infrastructure is designed to replace the fragmented, spreadsheet-driven processes that have undermined confidence in the asset class.
The new entity, Delta Capita Environmental Markets (DCEM), is a strategic partnership between financial services consultancy Delta Capita, natural capital tech platform Kana Earth, and environmental venture builder Tashinga Partnership. The venture directly targets a core market failure: the lack of robust, institutional-grade infrastructure which has led to opacity, a high risk of double-counting, and a collapse in trust, particularly in the voluntary carbon markets.
By focusing on the sovereign compliance market, DCEM aims to create a trustworthy ecosystem analogous to traditional equity or debt markets. The platform is built on four integrated technological pillars designed to cover the entire trade lifecycle:
- Hub: A system for digitalising the creation, verification, and management of environmental projects, standardising the “pre-issuance” phase to ensure a verifiable and scalable supply of credits.
- Seed: A digital asset management toolkit for institutional investors and sovereign wealth funds to manage portfolios of environmental assets, creating a structured buy-side.
- Registry: A bank-grade digital ledger, leveraging DLT to provide an immutable record of ownership that moves beyond basic databases.
- Settlement: The critical component, this DLT-based mechanism provides a “single source of truth” for the transfer of assets, ensuring settlement finality and preventing the double-selling of credits across different venues.
This focus on a robust settlement layer is the platform’s key differentiator. While other market participants have focused on building registries, DCEM argues that a registry without an integrated, trustworthy settlement function is an incomplete solution. By providing a mechanism for true delivery-versus-payment, the platform aims to give institutions the post-trade certainty they require to engage with these assets at scale.
Joe Channer, CEO of Delta Capita, commented: “DCEM represents a new era of cooperation, bringing the rigour of capital markets, managing services, the urgency of climate action, and the sovereignty of national environmental goals into a single interoperable framework.”
The ultimate goal extends beyond simple credit issuance. The DCEM leadership believes a trusted settlement infrastructure is the foundational layer required to build a liquid, sophisticated trading ecosystem. With settlement finality, institutional players can trade with confidence, which in turn opens the door for market makers to provide liquidity and for the development of more complex financial instruments, including derivatives. This would allow for more effective price discovery and risk management, attracting a deeper pool of institutional capital.
“Since the ratification of Article 6 at COP26, we have built not just a market, but a trust-based, transparent, digital ecosystem enabling sovereigns to lead the way in defining and delivering environmental value and economic success across their country, connected to the international markets,” observed Justin Reynolds, CEO of DCEM.
The venture has already signed agreements with two sovereign governments in Africa and Southeast Asia, with a formal announcement expected in August. To further catalyse activity, the platform is being built for interoperability. Rather than creating another ‘walled garden’, DCEM is actively engaging with established financial market infrastructure providers and exchanges, to ensure its settlement system can connect disparate pools of liquidity and provide the trusted plumbing needed to scale climate finance globally.
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