Kalium Bank Carbon Credit Principals

Postulate 0 - Carbon Credit

Definition: A carbon credit is a single unit that represents exactly one metric ton (1,000 kg) of carbon dioxide or CO₂-equivalent (CO₂e) removed, reduced, or avoided from the atmosphere.
This definition is foundational and must precede all other postulates.

Kalium DAO — The governing decentralised autonomous organisation that defines policy, approves methodologies by consensus, and holds ultimate authority over recognition and invalidation of credits.
Kalium Bank — The operational entity responsible for issuance (under DAO rules), registry operations, and acting as market facilitator/market-maker on Kalium Bank hosted exchanges.
Both entities are defined here so they may be referenced unambiguously in subsequent postulates.

Definition: Sequestration for Kalium credit eligibility means a removal method that sustainably sequesters carbon without human intervention for greater than 1,000 years.
Scope: Only methods that meet this strict scientific criterion qualify as sequestration for purposes of issuance under the sequestration category. Other removal or avoidance methods are treated as non-sequestration and follow the Credit Realisation rules.

Issuance authority: Credits are valid only if issued by the Kalium Bank or an approved exchange/operator acting under Kalium DAO-defined standards.
Methodology approval: Issuance must conform to a scientifically rigorous, DAO-approved methodology (baseline, monitoring, leakage, permanence where applicable).
Verification standard: Evidence supporting issuance or realisation must be transparent, auditable, reproducible, and capable of independent verification in accordance with DAO rules and accepted scientific practice.

Carbon credits exist in three lifecycle states:
1. Transferable — Eligible to be exchanged or sale.
2. Executable — Declared by the holder as used to make a claim (e.g., offsetting); once declared executable the credit is no longer transferable.
3. Retired — Permanently removed from circulation and cannot be reused or traded.
State properties: Each state has properties and tenors defined by the Kalium DAO and implemented by the Kalium Bank registry.
Tenure rule: Unless otherwise specified by DAO governance, the tenure of an executed credit is exactly one (1) year from the date of execution; upon expiry the credit is invalidated and then retired per the retirement process.

Definition: For all credits that are not classified as sequestration, realisation is the process by which the primary issuer demonstrates that the claimed reduction/removal has occurred according to approved methodology and is thereby eligible to be executed.
Rules:
- Non-sequestration credits may be traded (Transferable) prior to realisation, but cannot be declared Executable until the primary issuer has realised the credit and that realisation is confirmed by the Kalium Bank or by Kalium DAO confirmation where required.
- No credit may be executed to offset an owner’s emissions unless it has been realised.
- Unrealised credits may be traded (to enable financing to issuers), but any trade must carry explicit risk disclosure and register the credit as unrealised until confirmation.
- Realisation evidence must meet the verification rules in Postulate 3.

Fungibility rule: Within the Kalium ecosystem, credits that meet the defined eligibility, verification, and state requirements are fungible and equal in value for purposes of trading and accounting, subject to Kalium DAO governance provisions (e.g., labelling, vintage metadata, or special purpose flags).
Clarification: Fungibility applies only to credits that fully conform with Kalium definitions and have the required verification/realisation status.

Ultimate authority: The Kalium DAO is the sole authority empowered to recognise (validate) and invalidate carbon credits within the Kalium registry, per Kalium DAO governance procedures.
Operational role: The Kalium Bank implements issuance, registry entries, transfers, and administrative revocations under Kalium DAO direction.
Invalidation consequences: When a credit is invalidated (for example, due to proven error, fraud, or reversal), the Kalium DAO will prescribe remediation, which may include registry revocation, replacement obligations, and corrective accounting.

Amendments: Any amendment to core recognition or validation rules (including methodology changes that affect credit eligibility) requires an approval of at least 80%, with a quorum of over 60% of voting Kalium DAO shares, as defined by Kalium DAO governance documents.
Definition of voting membership and votes: Kalium DAO governance guids explicitly define voting membership, weighting, quorum calculation, and any supermajority procedures.

Exchange rules: Transferable credits are tradable on the Kalium Bank Exchange (or other Kalium DAO-approved venues) subject to registry flags (e.g., realised/unrealised, vintage, sequestration flag).
Execution rule: Only credits that are Transferable and Realised (or sequestration credits that meet the sequestration definition and are issued) may be declared Executable by the holder.
Scientific compliance: All evidence used to support exchange, realisation, or execution must comply with the verification standards outlined in Postulate 7 and be recorded transparently in the registry.