Carbon Markets at a Crossroads: Integrity, Infrastructure, and the Next Era of Scale

As the voluntary carbon market (VCM) emerges from a period of deep scrutiny, the stakes have never been higher. With credibility under the microscope and compliance frameworks gaining traction, the market is evolving rapidly. At Valitera, we see this as a necessary inflection point, a moment where integrity, infrastructure, and innovation must converge if carbon markets are to scale sustainably.

On the latest episode of This Week in Carbon, we sat down with Mandy Rambharos to explore how the world’s leading carbon standard is responding to the VCM’s shifting landscape, and what’s next for a market navigating credibility, compliance, and digital disruption all at once.

From Credibility Crisis to Market Rebuild

The past two years have marked an uncomfortable reckoning for the VCM. Investigative exposés and academic critiques have cast doubt onthe additionality and permanence of certain carbon projects, and buyers,especially publicly traded corporates, have grown more cautious. Some pressedpause. Others backed out entirely. The result has been stagnating demand andmounting uncertainty about the market’s future.

Verra, as the largest and most visible standard-setter,found itself at the center of this debate. But rather than retreat, theorganization has embraced reform. Rambharos noted that under her leadership,Verra has embarked on a sweeping quality and transparency push, reassessingmethodologies, modernizing its registry, and aligning more closely withemerging best practices like the Core Carbon Principles (CCPs) set by theIntegrity Council for the Voluntary Carbon Market (ICVCM).

“We had to acknowledge where the market had drifted andwhere expectations were heading,” she said. “Buyers today want more than a credit. They want a climate solution that’s backed by integrity, communitybenefit, and long-term monitoring.”

This recalibration reflects a broader trend, the move fromtransactional offsetting toward climate-aligned investing, where credibility iscurrency, and impact must be demonstrable.

The Convergence of Voluntary and Compliance Markets

As the voluntary market regains its footing, it’s also beingreshaped by the rapid evolution of compliance carbon regimes. Article 6 of theParis Agreement, now in early implementation, allows for the bilateral tradingof emissions reductions between countries, and CORSIA, the ICAO-run aviationoffset scheme, is fully operational with binding requirements from 2027 onward.

This convergence is reshaping the role of registries.Credits are no longer just offsets, they are increasingly compliance assets,subject to host country authorization, corresponding adjustments, andinteroperability with national accounting frameworks. Verra has worked toposition its standards accordingly, and in some cases, has pioneered mechanismsto make compliance integration easier. A notable example is Verra’s insurancestructure for CORSIA-eligible credits, which protects buyers from revocation riskif host country policies shift after issuance. Rambharos called this a “bridgemechanism,” an interim tool to unlock supply and de-risk participation whilethe policy frameworks continue to stabilize.

But these frameworks also come with trade-offs. Theprocedural burden on project developers is higher, and governments vary widelyin their readiness to authorize credits. “Some are eager to participate inArticle 6 trades. Others are still building the institutional capacity toevaluate and approve them,” she explained.

This uneven landscape is likely to persist, and success, Rambharos argued, will depend on flexible infrastructure that can accommodateboth legacy voluntary projects and compliance-grade innovations.

Restoring Demand Through Public-Private Signaling

While supply-side reforms have accelerated, demand-siderevival remains uneven. That’s why a new coalition, announced during LondonClimate Action Week in June 2025, could be a game-changer.

Led by the UK, Kenya, and Singapore, the Coalition toGrow Carbon Markets aims to publish a clear set of buyer guidelines byCOP30. Its focus, establishing what constitutes high-integrity credit use incorporate climate strategies.

For Rambharos, the significance of this initiative lies inits signal power. “When governments step up and say, ‘Here’s how to buy creditsresponsibly,’ it helps companies act with confidence, not fear.”

The VCM’s demand problem isn’t just about cost or project type, it’s about reputational risk. Public-sector alignment on claims guidance,project screening, and standards thresholds could be the nudge needed to bring hesitant buyers back into the market. If successful, the coalition could do for the VCM what green taxonomies did for sustainable finance, reduce ambiguity and enable scaled deployment of capital.

Digital Infrastructure: From Bottleneck to ScalableSystem

Alongside these market shifts, Verra has also launched aninternal overhaul, digitizing core workflows and streamlining project reviewthrough its new Project Hub platform.

Historically, credit issuance required a patchwork ofemails, PDFs, and inconsistent data formats. Now, Verra’s system integratesstructured data fields, allows direct access for third-party validators, andautomates key parts of the review process. Early results are promising, reducedturnaround times, fewer data discrepancies, and clearer audit trails.

“It’s not just faster, it’s more consistent,” Rambharos emphasized. “When we standardize inputs, we improve both speed andcredibility.”

The digital effort also includes tools like the Geologic Carbon Storage Risk Tool for permanence assessments in CCS projects and theDigital Verification Report, which allows VVBs to submit structured,machine-readable assessments.

This is more than process improvement, it’s scale infrastructure. As the number of projects and methodologies grows, Verra needssystems that can process complexity without compromising rigor. The Project Hub is a foundational step toward that future.

As Rene noted, “If carbon markets are going to scale togigatons, the infrastructure has to look more like Stripe than like agovernment permit office.”

A Glimpse into Carbon Markets 2.0: Blockchain and Beyond

Perhaps the boldest signal of Verra’s future ambitions is its integration with Hedera, a distributed ledger network purpose-builtfor environmental markets.

Through this partnership, Verra connected its digitalregistry infrastructure to the Hedera Guardian platform, enabling automateddocumentation submission and tamper-proof audit records. A pilot with amangrove restoration project in Senegal served as a proof of concept, usingVerra’s digitized wetland methodology (VM0033) to auto-generate a compliantproject design document.

The implications go far beyond back-office efficiency. Blockchain could enable traceable, real-time credit tracking from issuancethrough retirement, and potentially integrate with satellite monitoring or IoT sensors to allow for automated verification.

“We’re not just thinking about carbon credits as files in aregistry,” Rambharos said. “We’re thinking about them as dynamic digital assetsthat live in a connected, transparent ecosystem.”

Long term, she envisions a future where machine learning,remote sensing, and digital MRV converge to unlock real-time climate finance,where buyers could fund projects and receive validated impact data in nearreal-time.

The Road Ahead: Optimism, with Eyes Wide Open

Despite the complexity, Rambharos remains firmly optimistic.“Carbon markets are maturing. We’re leaving behind a world of ambiguity and moving toward one of alignment, integrity, and scale.”

It’s not just about faster issuance or fancier platforms,it’s about restoring trust. And that trust, she argues, must be earned throughtransparency, credibility, and collaboration across public, private, and civicsectors.

Verra isn’t the only actor in this story, but it’sundeniably central. And if its current trajectory holds, the VCM might justemerge from its crucible not just intact, but fundamentally transformed.

🎧 Listen to the fullconversation from This Week In Carbon Here: Rebuilding Carbon Markets: Verra’s CEO on What Needs to Change - Mandy Rambharos