ReFi tokens as climate-finance assets: Connectedness with renewable energy token and fossil energy

Alishba Rahman ULLAH; Shahzeb KHURSHID; Asma Rehman ULLAH; Michal WOJEWODZKI; Seong-Min YOON

doi:10.1016/j.frl.2025.108790

ReFi tokens as climate-finance assets: Connectedness with renewable energy token and fossil energy

Alishba Rahman ULLAH, Shahzeb KHURSHID, Asma Rehman ULLAH, Michal WOJEWODZKI, Seong-Min YOON^*

^*Corresponding author for this work

Department of Finance

Research output: Journal Publications › Journal Article (refereed) › peer-review

Abstract

This paper pioneers exploring the attributes of risk contagion of emerging ReFi token markets, characterized by considerable volatility, through a time–frequency risk spillover within the integrated ReFi–renewable energy token–fossil fuel system. Findings reveal that ReFi tokens (Moss, Klima) and renewable energy tokens (EWT, POWR) act as shock transmitters. In contrast, fossil fuels consistently act as shock absorbers, with short-term spillovers dominating over all domains. Portfolio insights show that ReFi–fossil fuel pairs offer the strongest hedging. In contrast, policy insights underscore the role of ReFi and renewable tokens as tools to redirect capital, strengthen resilience, and support the low-carbon transition.

Original language	English
Article number	108790
Journal	Finance Research Letters
Volume	86
Issue number	Part F
Early online date	28 Oct 2025
DOIs	https://doi.org/10.1016/j.frl.2025.108790
Publication status	E-pub ahead of print - 28 Oct 2025

Funding

The last author (S.-M. Yoon) is thankful for the financial support from the National Research Foundation of Korea Grant funded by the Ministry of Education of the Republic of Korea (NRF-2022S1A5A2A01045530).

Keywords

ReFi Tokens
Fossil fuels
Renewable energy tokens
Time-frequency connectedness
TVP-VAR model

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Access to Document

10.1016/j.frl.2025.108790

Cite this

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title = "ReFi tokens as climate-finance assets: Connectedness with renewable energy token and fossil energy",

abstract = "This paper pioneers exploring the attributes of risk contagion of emerging ReFi token markets, characterized by considerable volatility, through a time–frequency risk spillover within the integrated ReFi–renewable energy token–fossil fuel system. Findings reveal that ReFi tokens (Moss, Klima) and renewable energy tokens (EWT, POWR) act as shock transmitters. In contrast, fossil fuels consistently act as shock absorbers, with short-term spillovers dominating over all domains. Portfolio insights show that ReFi–fossil fuel pairs offer the strongest hedging. In contrast, policy insights underscore the role of ReFi and renewable tokens as tools to redirect capital, strengthen resilience, and support the low-carbon transition.",

keywords = "ReFi Tokens, Fossil fuels, Renewable energy tokens, Time-frequency connectedness, TVP-VAR model",

author = "ULLAH, \{Alishba Rahman\} and Shahzeb KHURSHID and ULLAH, \{Asma Rehman\} and Michal WOJEWODZKI and Seong-Min YOON",

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AU - ULLAH, Alishba Rahman

AU - KHURSHID, Shahzeb

AU - ULLAH, Asma Rehman

AU - WOJEWODZKI, Michal

AU - YOON, Seong-Min

PY - 2025/10/28

Y1 - 2025/10/28

N2 - This paper pioneers exploring the attributes of risk contagion of emerging ReFi token markets, characterized by considerable volatility, through a time–frequency risk spillover within the integrated ReFi–renewable energy token–fossil fuel system. Findings reveal that ReFi tokens (Moss, Klima) and renewable energy tokens (EWT, POWR) act as shock transmitters. In contrast, fossil fuels consistently act as shock absorbers, with short-term spillovers dominating over all domains. Portfolio insights show that ReFi–fossil fuel pairs offer the strongest hedging. In contrast, policy insights underscore the role of ReFi and renewable tokens as tools to redirect capital, strengthen resilience, and support the low-carbon transition.

AB - This paper pioneers exploring the attributes of risk contagion of emerging ReFi token markets, characterized by considerable volatility, through a time–frequency risk spillover within the integrated ReFi–renewable energy token–fossil fuel system. Findings reveal that ReFi tokens (Moss, Klima) and renewable energy tokens (EWT, POWR) act as shock transmitters. In contrast, fossil fuels consistently act as shock absorbers, with short-term spillovers dominating over all domains. Portfolio insights show that ReFi–fossil fuel pairs offer the strongest hedging. In contrast, policy insights underscore the role of ReFi and renewable tokens as tools to redirect capital, strengthen resilience, and support the low-carbon transition.

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KW - Fossil fuels

KW - Renewable energy tokens

KW - Time-frequency connectedness

KW - TVP-VAR model

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DO - 10.1016/j.frl.2025.108790

M3 - Journal Article (refereed)

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