Regen Market Imperfections

I am not a developer and have no experience with blockchain but I understand regenerative agriculture and a bit about economics. I have a few questions after reading the whitepaper.

If I am correct in understanding the purpose: to create a means to verify environmental improvement while connecting those affecting the changes with those interested in investing in such changes.

It seems that all of this is predicated on change of state, with the main assumption being that land is not allocated to its optimal ecological use. If this is true, then:

  1. How does a farmer get paid if their land is already managed optimally and therefore requires no change?
  2. How does the Regen Network avoid the perverse incentive farmers might have to allow degraded land to descend into its worst state before making improvements in order to maximize payment?
  3. Does a farmer get paid continually for the improved state, or is it only for the change toward regenerative farming?

Hi @J3D!

Sorry for the horrendous delay, I can do my best to answer your questions. I am going to look and see where the post notifications are going.

Your first question
The crux of this is actually the word optimal. For most companies, on paper, it’s somewhat possible to reduce any complex set of possibilities into single dimensional projections involving a number of dollars. But if you apply it to the dense set of social, economic, and environmental forces around agricultural land use, you quickly start to realize that what you are actually asking is “optimal towards what”. Think of a computer science problem, you must choose which parameters you want to optimize for.

In the business world, the latent assumption here is that you are optimizing for profit. But even that has a lot of gray area. For instance, on what timescale are you considering? And is your company cannibalizing the social goodwill of it’s customers? Such as the modern advertising industry. Sure it’s profitable, but it’s also conditioning people to ignore you in any way they can.

When we look at agricultural land use in so called “developed nations”, or countries providing export crops to these nations, it’s pretty clear that the focal point of profit has been growing shorter and shorter. Out of market necessity, or at times possibly greed, most modern agricultural practices are heavily and systemically destroying their own soil through optimizing for short term profit. If you’re involved with regenerative agriculture, then you probably already understand this.

The short answer to number one is that there’s no farmer in existence who is in tune with their land that wouldn’t choose to better build up the quality of their soil if the markets would support them in doing it. Regen Network’s primary goal is to help Nations, Corporations, and Consumers support farmers in being able to make longer term decisions about their land.

Question number two
Excellent question! We’re determined to see a system that quantifiably increases the health of landscapes across the globe. Obviously paying people to see improvements could lead to some pretty aberrant behaviors. One resource we have is our partners’ high resolution historical satellite imagery, if someone intentionally clearcuts a holding just prior to signing up, for instance, we’d know and be able to respond appropriately. Additionally for commercial agrarian landscapes, while the amount of money they’d receive through positive ecosystem services would be enough to help support them in their transitions, it likely would remain a relatively smaller amount compared to the potential income of their normal production. In many situations there is a very clear financial incentive not to degrade land any worse than it already is. But we are aware that in other situations the incentives could be there, and a close eye needs to be kept to spot these before they could become problematic.

Question three
Depending on the project, a land steward will be paid for quantifiable improvements in the state of their landscape. This could mean carbon, water quality, biodiversity, pollinator habitat, and more. Some practices could be rewarded if our regenerative data commons is able to assess likely outcomes through modeling for their geographic location. At any rate, as long as the health of the land is improving, the stewards will continue to be paid.

I hope that helps answer some of your questions, if not feel free to provide additional clarifications. Also, if I might ask, where did you hear about us?

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