A New Circular Economy with Digital Currency, Carbon Credits, and Social Technologies
Consolidated report for the Regional Coordination Forum, covering the entire project from financing to innovative socio-environmental solutions.
1. Introduction
The municipality of Itacaré, on the southern coast of Bahia, is nationally recognized for its natural beauty and for having closed its open-air dump ahead of the legal deadline. It is now about to take a revolutionary step in solid waste management. A new recycling cooperative is being formalized, combining community tradition, technological innovation, and sustainability. This document consolidates all the information discussed about the project, from funding sources to the innovative social technologies that will be implemented.
2. Context and Protagonist: The Casa do Boneco de Itacaré
The Casa do Boneco de Itacaré Association for Afro-Development (CBI) is the community organization leading this project. Founded in 1988, the entity acts as a contemporary urban quilombo, dedicated to mitigating the socio-cultural and economic impacts of capitalism on the Afro-indigenous communities of Itacaré.
With a track record of training hundreds of young people in areas such as bioconstruction and community management, CBI already has experience in recycling. Additionally, it manages the Quilombo D’Oiti Model Farm, a self-managed territory that serves as a base for community-based ethnic tourism and the implementation of social technologies. The Association has already collected 100 tons of recyclable dry materials in just five months of operation of its collectors’ association.
3. The New Recycling Cooperative
Building on this solid foundation, Casa do Boneco is formalizing a recycling cooperative to expand its socio-economic and environmental impact in the region. The initial focus will be on three strategic materials:
- Organic Waste: with high potential to generate bio-inputs and animal protein.
- Glass: 100% recyclable material with strong market demand.
- Aluminum: high added value in the recycling market.
4. Innovations and Integrated Projects
The cooperative will go beyond traditional sorting, incorporating four innovative pillars that place Itacaré at the forefront of the circular economy.
4.1. ItaCycle – The Digital Social Currency
Inspired by experiences such as the “$iclos Sustentáveis” currency (Espírito Santo) and the Recircular project (which uses cryptocurrency to pay waste pickers), ItaCycle will be a digital social currency backed by recyclable waste.
- How it works: Residents and tourists who deliver recyclable materials to collection points will receive ItaCycles in a digital wallet.
- Usage: Credits can be exchanged for products, services, and discounts in local businesses.
- Technology: Use of blockchain and smart contracts to track each stage of the recycling process, ensuring transparency and traceability.
- Financial Inclusion: The system also promotes financial inclusion for waste pickers and families in vulnerable situations.
4.2. Carbon Footprint Calculation and Carbon Credits
The cooperative will implement a carbon footprint measurement system to quantify the environmental impact of its operations.
- Metrics: Quantification of CO₂ avoided by recycling each material (glass, aluminum, and organics).
- Market: Generation of carbon credits for trading on the voluntary market. Similar projects have shown that recycling can generate over R$ 1 million in credits for cooperatives.
- Attraction: Possibility of attracting companies and events (especially from the tourism sector) looking to offset their emissions, taking advantage of Itacaré’s high season visitor flow.
4.3. Organic Waste-to-Larvae Production (BSF)
Using the Black Soldier Fly (Hermetia illucens) to transform organic waste into high-value products.
- Animal Protein: The larvae, rich in protein (30-35% fat and up to 50% protein), serve as feed for poultry, fish, pigs, and pets.
- Biofertilizer: “Frass” (the larvae’s digestion residue) is a powerful agricultural input.
- Efficiency: The system can reduce the volume of organic waste by up to 80%. Each ton of organic waste can generate up to 900 kg of protein in the form of larvae.
- Scalability: Modular systems can process between 24 and 36 tons of waste per month, producing 3 to 8 tons of fresh larvae monthly.
4.4. Green Coconut Processing
Itacaré is one of the largest consumers of green coconuts on the southern coast of Bahia, with 12 potential suppliers mapped in the municipality. It is estimated that the region wastes the equivalent of 872,000 coconut husk units annually, from which approximately 328 tons of fiber could be extracted — but today, this material ends up in the landfill.
The cooperative aims to change this scenario with a green coconut processing line, transforming the husk into:
- Fiber for manufacturing ropes, mats, and handicrafts.
- Coconut powder for agricultural substrates and biodegradable pots.
- Activated carbon and other high-value by-products.
With the new National Policy to Encourage Cocoiculture (Law 14.975/2024), the sector has gained extra momentum, opening doors to credit lines and tax incentives.
5. Financing and Institutional Support
The formalization and expansion of the cooperative are supported by key institutions and programs.
5.1. BNDES and the “Tudo na Circularidade” Program
The Brazilian Development Bank (BNDES) launched the program “Tudo na Circularidade – Investing in Recyclable Material Cooperatives” in March 2025.
- Funding: Initial allocation of R$ 20 million from BNDES’s Socio-Environmental Fund, with expectations to raise up to R$ 100 million.
- Objective: To expand the access of cooperative and waste-picker networks to the Reverse Logistics Credit (CLR) market and boost job and income generation.
- Innovation: Cooperatives will be compensated not only for the weight of recycled material but also for the environmental services they provide.
- Reverse Logistics Credits (CLR): Established in 2023, this is a compensation mechanism similar to carbon credits. Cooperatives are entitled to receive payment for selling the credits generated by their recycling activities.
The program also provides for investments in technological modernization and innovation, overcoming challenges such as taxation, logistics, and low profit margins.
5.2. Other Support
- Sebrae: Active role in strengthening management and cooperativism through the Pró-Catadores Project, offering specialized consulting, training, and guidance on formalization.
- State Government: Programs such as Bolsa Reciclagem (which in Minas Gerais allocated R$ 875,000 to 72 cooperatives in Q2 2024) serve as references for Payment for Environmental Services (PES) policies that could be adapted for Bahia.
6. Impact and Future
With formalization, the cooperative will be able to access public bids, sign contracts with the government, and establish itself as a reference hub for the circular economy on the southern coast of Bahia.
By combining the tradition and community organization of Casa do Boneco de Itacaré with innovative technologies (digital currency, biolarvae factory, and carbon credits), Itacaré demonstrates that it is possible to turn environmental challenges into opportunities for income generation, social inclusion, and preservation of Afro-indigenous culture.
The city, already nationally renowned for projects such as the Screening and Ecobusiness Center and the PROMARES Project (an international pilot area for fighting marine litter), is solidifying its status as a true living sustainability laboratory on the southern coast of Bahia.
7. Conclusion
The recycling cooperative led by Casa do Boneco de Itacaré represents an innovative model that integrates:
| Axis | Innovation |
|---|---|
| Financial | Digital social currency (ItaCycle) |
| Environmental | Carbon credits and reverse logistics |
| Technological | Black soldier fly larvae production |
| Productive | Green coconut processing |
| Institutional | Access to non-reimbursable BNDES funds |
This project demonstrates that the circular economy can be inclusive, digital, and sustainable, generating income for families living off recycling while strengthening the cultural identity of Itacaré’s Afro-indigenous communities.
Stay Tuned: The cooperative is in its structuring phase and is seeking partnerships to bring ItaCycle and its other innovations to life. The BNDES “Tudo na Circularidade” call for proposals closed in May 2025, but new opportunities and notices are expected to arise soon.
This document consolidates information from the Casa do Boneco de Itacaré Association for Afro-Development, BNDES, Sebrae, FATTO, Plástico Transforma, UFSB, ScienceDirect, and Agência Brasil.