Climate Impact X Named Custodian for Abaxx Futures

Climate Impact X has been named custodian for Abaxx’s carbon futures, the two firms announced this week. Climate Impact X will hold and manage the verified carbon credits that will back Abaxx’s physically settled futures contracts.

Under the agreement, Climate Impact X will maintain records of credit ownership, verify serial numbers and vintages against established registries, and facilitate transfer and retirement of credits when contracts reach settlement. The custodian will also handle reconciliation with registries and provide operational support for settlement mechanics.

Abaxx operates a trading venue for carbon and related instruments and is developing standardised futures to give investors and corporate buyers a regulated way to gain exposure to verified carbon credits. Climate Impact X runs a marketplace and infrastructure for credits and will link those credits to the futures market through its custody services.

The companies said the custodial arrangement is part of the operational setup for futures that are physically settled, where a clear chain of custody is required to permit delivery. Abaxx expects custody to reduce operational friction when contracts are exercised and to provide counterparties with proof of the existence and provenance of the underlying credits. The agreement sets out procedures for the retirement of credits once they satisfy delivery obligations.

Both firms noted technical and procedural elements must be coordinated across registries, exchanges and clearing systems. Climate Impact X will work with Abaxx to align registry reporting and, where applicable, token or ledger records used in secondary trading and transfer. The custodian role will include periodic audits and reporting to support transparency for market participants.

In a joint statement, Abaxx described the arrangement as intended to support “robust settlement” for its futures contracts, while Climate Impact X characterized its role as providing “secure and verifiable custody” of credits backing exchange-traded products. Neither party disclosed commercial terms of the agreement.

Carbon futures are exchange-traded contracts that allow buyers and sellers to lock in prices for emissions credits to be delivered at a future date. Physically settled carbon futures require that the underlying credits exist, can be transferred and can be retired at settlement. Custodianship addresses concerns such as double counting, incorrect vintage claims and gaps between registry records and exchange settlement systems. Market participants and regulators have highlighted links between custody and registries as a governance element for expanding carbon markets.