Breaking Down "The State of ReFi" 2024 Report


Regenerative economics, inspired by the work of John Fullerton, Herman Daly, and others, suggests our economy is a living system that can nurture our planet if implemented in the way. With the rise of web3, this concept has found new ground, leading to the birth of regenerative finance (ReFi). While still relatively new, ReFi has become a lively space filled with many projects, approaches, and actors looking to build more sustainable and inclusive economies.

To map this development and provide some much-needed sense making, CARBON Copy and ReFi DAO have recently joined forces to publish The State of ReFi Report, giving an overview of existing ReFi efforts as well as the key narratives in the space as of 2024.

Download full report at
Download full report at

“ReFi has proven itself as a viable solution in the fight against climate change and income inequality. And while impact remains relatively small and localised, there are real people on the ground benefitting from this new approach to finance.”

If you haven’t explored the report yet, dive into the key points with us and understand why resources like these are crucial for navigating and propelling ReFi forward.


  • The new “State of ReFi Report” emphasizes the importance of clear definitions and frameworks within ReFi, illustrating how a unified understanding can enhance collaboration and innovation across various stakeholders in the sector.

  • It highlights the opportunities but also challenges ReFi faces, such as building trust among the public and dealing with regulatory hurdles, highlighting the need for clear communication and broader accessibility.

  • Emerging trends within ReFi, like the development of tokenized ecological assets and partnerships with decentralized systems, are spotlighted as key drivers for expanding its impact and resilience.

What is the ReFi report? 📝

The State of ReFi report came to life following an insight at a crypto event last summer, where the majority of attendees had no idea what ReFi was.

This sparked a series of conversations and the realization that ReFi, often seen as simply connecting blockchain and climate, was not only underestimated but also misunderstood in terms of its business potential and impact. And sometimes, the perception would be outright negative due to past carbon scandals involving actors like Verra or South Pole.

The report was drafted to fill this awareness gap but also to give projects in the space a document to reference, offer a potential narrative to onboard non-ReFi people, and build the foundations for further, more in-depth research.

Defining ReFi, once and for all 🌿

Today, there are probably hundreds of definitions of ReFi. It’s, therefore, no wonder that a big part of the report is devoted to clarifying what ReFi entails.

Here are three direct extracts from the report:

  • ReFi represents a belief that our current economic and financial system needs to change if we are going to address our systemic issues, and that this new system needs to be decentralised, equitable, and regenerative, not centralised, unjust, and extractive.

  • Critically, ReFi is not a panacea, nor necessarily feasible as an alternative to our current financial system. It is however a core piece of the much larger, collaborative effort that is required at all levels to address systemic issues such as climate change and income inequality.

  • At a more practical level, ReFi can be described as Web3-powered ecological and social impact. In other words, taking the available Web3 solutions—blockchain, cryptocurrency, smart contracts, and decentralised autonomous organisations (DAOs)—and combining them with other modern technologies to build solutions that address our systemic issues.

As the report states, ReFi makes this happen through a multifaceted approach. It facilitates the flow of funding and incentives from their sources to end users via decentralized services and treasury governance mechanisms.

It also provides end users with data-driven tools to derive financial value from regenerative practices and supports the issuance of new currencies and investment instruments backed by tokenized ecological assets.

These are some of the practical applications:

  • Digital measurement, reporting, and verification (dMRV) of ecological credits

  • Low-interest micro-lending platforms

  • Circular economy projects

  • Ecological credit marketplaces

  • Climate data oracles

  • Universal basic income schemes

  • Social impact verification

  • Public goods funding mechanisms (quadratic, retroactive, etc.)

Overall, ReFi pushes for a systems thinking approach, emphasizing the interconnectedness of ecological and social impact. It champions a proactive over a reactive approach and values coordination and collaboration above competition. And, integrating technology such as AI, IoT, and mobile payment services, it holds an important innovative edge.

💡 Food for thought: Do we need web3?

The report highlights web3’s dual role in ReFi as both foundational and challenging due to its scalability issues in real-world applications. Innovations like more accessible wallet security hint at progress, yet the reliance on volatile utility tokens questions the economic sustainability within web3 ecosystems.

Some ReFi projects are actually scaling back on web3 to meet market demands, indicating a pragmatic shift. This suggests a growing understanding in the ReFi community that Web3 should be used selectively rather than as a universal solution.

Key takeaways 👇

In a nutshell, ReFi represents a grass-roots impact and technological movement that embodies the decentralized ethos and utilizes new incentive frameworks to achieve regeneration.

The report estimates at least 500 active ReFi solutions in existence today along with the following trends:

  • Tokenised Ecological Assets: Tokenisation has made it easier to track and trade ecological assets transparently on the blockchain. This innovation has paved the way for natively issued on-chain credits, revolutionizing how ecological impacts are measured and verified thanks to two-way bridges, dMRV and satellite data.

  • Ecological Accounting: To expand the focus beyond carbon, ReFi draws on the Ecological Benefits Framework (EBF), a more holistic approach to ecological accounting that includes other vital ecological benefits such as biodiversity and soil quality.

  • Alternative Funding Mechanisms: In response to declining venture funding, the ReFi sector has seen the emergence of alternative community-driven fundraising methods like quadratic funding (QF) and retroactive public goods funding (RetroPGF) that democratize the allocation of funds for public goods projects.

  • Network Societies and CoordiNations: ReFi introduces a novel approach to global collaboration and collective action. By fostering local nodes or communities, these network societies provide a framework for decentralized cooperation, embodying the principles of inclusivity and collective capacity.

  • Decarbonisation of Blockchain Infrastructure: Efforts to minimize the environmental footprint of the ReFi infrastructure have gained momentum, with initiatives like the Crypto Climate Accord and carbon-neutral, Proof of Stake blockchains leading the charge.

  • Ideological Dichotomy: The ReFi community is split between pragmatists, who advocate for leveraging existing financial systems for regenerative ends, and ideologues, who prioritize grassroots impact and resist commercialization. This ideological tension highlights the ongoing debate over the future direction for ReFi.

  • Integration with Decentralised Physical Infrastructure Networks (DePINs): The growing collaboration between DePIN, the ecosystem that leverages crypto-incentives to build and operate critical physical infrastructure, and ReFi offers opportunity for bigger ecological  impact.

  • New research: Despite a surge in ReFi coverage, the lack of reliable data and verified impact reporting, combined with the tendency for hype-driven narratives, underscores the need for more empirical research to accurately evaluate ReFi's real-world impact.

The ReFi Landscape 2024 (a snapshot)
The ReFi Landscape 2024 (a snapshot)

The report predicts that ReFi stands to have the biggest impact in the following areas:

  1. Reputable on-chain digital measuring, reporting and verification (dMRV) frameworks in the voluntary carbon market.

  2. Increased access to finance via low-interest loans thanks to minimal overhead and digital integration.

  3. Addressing the climate change adaptation gap via tailored finance solutions like global liquidity pools.

  4. Connecting retail investors directly to real-world impact via impact-generating investments such as equity crowdfunding, ecological asset index funds, and green bonds.

Key opportunities for 2024 👀

The report underscores that the main way for ReFi to establish itself is to create trusted on-chain ecological credits to build confidence in the carbon market and incentivize nature-positive activities.

“At a much higher level, what is needed is a system that can ensure that an issued credit is equal to its commensurate impact.”

Another opportunity lies in tokenizing real-world assets (RWAs) relevant to ReFi, such as ecological credits, shares in renewable energy infrastructure, green debt instruments, and currencies backed by ecological assets.

ReFi can also improve micro-lending with affordable, accessible loans, adding value to development finance. Moreover, horizontal scaling allows ReFi to replicate and adapt successful models across different regions, enhancing impact while staying local and decentralized.

Challenges 🫣

  • Public reputation remains an obstacle to wider adoption due to ReFi’s association with the broader, often mistrusted crypto industry and its linkage to scandals within the voluntary carbon market.

  • Over-financialisation concerns and the pressure of commercialisation by venture capital interests can potentially conflict with ReFi's foundational principles.

  • ReFi's innovative models for tokenised assets and new financial instruments suffer from lack of regulation or, conversely, increased legal scrutiny.

  • Measuring impact is difficult due to the current lack of standardized metrics for evaluating ReFi's effectiveness.

  • The complexity and user-unfriendly nature of many blockchain-based systems present significant usability challenges for ReFi adoption.

Why should we care about the report? 🤔

Today, few comprehensive resources on ReFi analyze its real-world applications, lessons learned, and best practices. Yet, sharing such insights is vital to the maturing of any space.

We hope to see more research like this in the future, as it brings many benefits, including:

  • Enhancing our understanding: The report shares clear insights that deepen our grasp of ReFi. This helps us foster productive collaboration and strategic thinking within the community.

  • Benchmarking progress: A year from now, everything will be different. Resources like these offer a thorough snapshot of ReFi’s current state, setting a standard for the future evolution of the space.

  • Showcasing success: The report highlights the real-world change ReFi solutions can bring about, from EthicHub's funding achievements to Regen Network's credit issuance successes.

  • Enhancing credibility: With its in-depth analysis, the report aids in advocacy and fosters the legitimacy of the ReFi sector.

  • Stimulating dialogue: Resources like these fuel conversations about traditional financial systems, presenting a regenerative alternative for stakeholders.

Summing up ✍️

The report concludes that ReFi must prioritize developing trusted impact verification systems and metrics to accurately value ecological assets and combat greenwashing. By integrating diverse technologies and fostering effective coordination within the community and with external stakeholders, ReFi can drive forward its mission.

👉 Read the full report here and make sure to stay up to date with everything ReFi DAO.

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