Amid the challenges posed by this emerging market — and the numerous fraud cases involving carbon credits, which face structural flaws since inception — even with Bill No. 15.042 (establishing the Brazilian Emissions Trading System – SBCE) aiming to regulate this sector in Brazil, it is urgent that regulatory bodies take effective action to protect public interest and ensure a traceable, transparent, and auditable environment.

In recent years, Brazil has advanced the development of legislation aimed at the digital asset market. With the enactment of Law No. 14.478/2022, known as the Crypto Asset Legal Framework, the institutional need to regulate this new ecosystem has been officially recognized. However, it is the role of the Central Bank of Brazil (Bacen) and the Brazilian Securities and Exchange Commission (CVM) to regulate the market, prevent fraud, and establish appropriate conduct standards for digital assets.

At B4, the first Climate Action Exchange, we have established a rigorous accreditation standard for projects seeking to be listed. This includes comprehensive due diligence, smart contract validation, blockchain-based traceability verification, and independent third-party audits.

Transparency is a core pillar at B4: all project data — including whitepapers, on-chain transaction history, and legal documents — is publicly available. In addition, B4 adheres to the United Nations Global Compact principles, promoting best practices in sustainability.

How does B4’s Accreditation Standard work

Since the founding of B4 on March 13, 2023, we have tackled head-on the greatest challenge in Brazil’s carbon market. As reported by Estadão:

“Brazil’s first carbon credit exchange reports attempts to list fake credits — according to B4, of the 20 million credits submitted in the first two weeks of operation, only 1% were approved.”

Estadão article link https://www.estadao.com.br/economia/governanca/bolsa-credito-carbono-tentativa-listagem-creditos-falsos

These issues go beyond data manipulation attempts to list fraudulent sustainable assets — they also include impersonation attempts to falsely represent B4 itself.

To reinforce our commitment to integrity, B4 provides a direct channel to report misconduct or fraud:

📩 denuncia@b4.capital

Anyone may use this channel to report suspicious conduct, fraudulent projects, or actions that violate the market’s code of ethics or B4’s own standards.

All reports are treated confidentially. Supporting evidence is assessed by our compliance team and may be forwarded to competent authorities such as the Central Bank, CVM, or the Public Prosecutor’s Office, when necessary.

Understanding the Role of B4

B4 is a Climate Action Exchange that exclusively lists Sustainable Assets and projects that are properly structured and must be approved through rigorous auditing processes.

B4 is not a certifier or a regulatory authority. We do not issue investment opinions or guarantee financial returns.

Brazil Legal Basis for B4’s Operations

• Law No. 14.478/2022 (Crypto Asset Legal Framework)

• Decree No. 11.563/2023 (regulatory authority of the Central Bank)

• CVM Legal Opinion No. 40/2022 (utility token and securities classification)

• Law No. 9.605/1998 (Environmental Crimes Act) and Law No. 12.846/2013 (Anti-Corruption Law)

• Bill No. 15.042 (Brazilian Emissions Trading System – SBCE)

• CAD Trust and ISDA VCC standards (carbon credit traceability)

• SFDR guidelines (Sustainable Finance Disclosure Regulation)

• TCFD standards (Task Force on Climate-related Financial Disclosures)

• UN Global Compact Principles (Brazil network)

✅ What B4 Does

B4 acts as a bridge between those who want to buy and sell sustainable assets, such as carbon credits.

• Lists sustainable assets backed by carbon credit-generating projects, following legal, technical, and environmental due diligence.

• Ensures full traceability through blockchain: issuance and distribution are fully auditable and publicly accessible.

• Promotes transparency: whitepapers, contracts, audits, and registration data are available on the platform.

• Monitors sustainable practices in line with UN Global Compact and anti-greenwashing guidelines.

❌ What B4 Does Not Do

• B4 is not a regulatory body — regulatory oversight lies with Bacen (for utility tokens, exchanges) and CVM (for securities and fraud prevention).

• Does not provide investment advice or guarantee returns.

• Does not engage in the direct sale of tokens, carbon credits, or any other assets — whether individually, via third parties, or through P2P models.

The only official negotiation channel is through the B4 platform, where only listed sustainable assets are available, communicated via B4’s institutional channels, industry media, and recognized public outlets.

There is no off-platform commercialization — all transactions are public and recorded on blockchain.

• B4 does not monitor any assets outside of its ecosystem.

At B4, the combination of regulatory compliance and rigorous internal standards — aligned with Bacen, CVM, environmental legislation, and anti-greenwashing practices — along with smart due diligence, blockchain-based traceability, and sustainable governance, creates a trustworthy environment for the distribution of Sustainable Assets with verified access to carbon credits.

The denuncia@b4.capital channel is part of our mission to strengthen market trust and protect every participant. Together, we are building a sustainable, secure, and transparent layer for financial future.