carbon footprint of an NFT
carbon footprint of an NFT and the effect
The latest blockchain craze is non-fungal tokens, more commonly known as NFT, but there has been some pushback from the artistic community that makes many of the NFT designs. While there are still many who are enchanted by the profit potential of these new digital works of art, there are others who have begun to tell the story of an earth-killing monster. But whether it is considered an economic savior or an ecological disaster, there is no doubt that many still believe that NFTs are the cutting edge and possibly the future of digital art.
The long-standing issue is the environmental effects of NFT, especially in this time of climate change, carbon offsets and the New Green Deal. Artists who are also strong environmental activists have recently started moving from NFT, even where it could potentially cost them millions of dollars in revenue. These artists claim that the environmental effects of NFT are simply too great.
For those who are only introduced to this digital art form, we will examine exactly what an NFT is and how we can determine whether their environmental impact is justified or not.
What is an NFT?
A non-fungible token, or NFT , is a unique digital design that has been recorded on a blockchain ledger to indelibly record the design's authenticity and ownership. NFT was created as a way for artists to ensure that their digital art can not be falsified. This ability to establish authenticity and ownership is crucial to digital artwork, as replicas are so easy to produce and so difficult to detect.
Because NFTs are registered as blockchain assets, they are characterized in the same way as cryptocurrency tokens. Currently, most NFTs are created on the Ethereum blockchain. When embossed, a unique entry is created in the blockchain ledger that identifies the created asset. Whenever it is sold, the asset transfer is also registered in the blockchain, which means that the ownership of the asset is always known and publicly available. This also allows the artist to make a percentage of the sale price not only on the first sale but also on each subsequent sale of NFT.
When a digital artwork is embossed in this way, it can still be copied and distributed as .jpg or .png or .gif as usual, but the associated NFT always remains unique.
What is the carbon footprint of an NFT?
Before we discuss the carbon footprint of an NFT, we need to know what an carbon footprint is exactly. A carbon footprint is an estimate of all the carbon emitted during the process of creating and consuming a product. Depending on what the product is, this process can be dramatically different. What type of input is used, for example, when making a glass bottle? Is it raw materials or recycled materials? What type of energy is used in the manufacturing process? What does the bottle hold and how should it be transported to its final destination? All of these things will affect the carbon footprint of the glass bottle.
Because there are so many variables in the carbon footprint, we almost always have to estimate what the carbon footprint is for each object or person. Because calculating the exact footprint would be so complicated, using an estimate can be extremely useful in understanding the impact an object, such as an NFT, may have on the environment.
When it comes to NFTs, there are a number of steps in the embossing that do not have a known carbon footprint, and there are few research studies on the subject. As mentioned, Digiconomist, a website that examines the unintended consequences of digital trends, has developed an Ethereum Energy Consumption Index (you can see it here ) that estimates the carbon footprint of a single Ethereum transaction at 37.29 kg CO2 (as of May 2021). That equates to the carbon footprint of 82,648 6,215 VISA transactions or XNUMX XNUMX hours of viewing on YouTube.
There are others who have made predictions regarding the carbon footprint of NFT that account for the fact that every time an NFT is embossed or sold, it creates a new transaction on the Ethereum blockchain. For example, the artist Memo Akten has suggested that an NFT embossing has a carbon dioxide footprint of approximately 48 kg CO2. In both cases, we can say that the carbon footprint created by NFT is unusually high and probably unacceptable for creating a digital work of art.
Because of this, there have been a number of artists who have decided to avoid NFT, even if it means losing a lot of income. Such a choice has been compared to avoiding flying or cycling to work or avoiding beef in your diet. This is because all of these things are not a necessity, and by cutting them out of our lives we can have a positive impact on our own carbon footprint.
For example, beef has a carbon footprint that is about ten times larger than chicken, so cutting beef from our diets can have a significant impact on our carbon footprint over the years and decades. And if it's worth avoiding beef to lower our carbon footprint, it's really worth avoiding the creation or purchase of NFT.
Climate change is not caused by individual choices
Some people claim that making double choices to reduce our own carbon footprint is almost useless because only 100 companies are responsible for 71% of the world's carbon emissions. Reducing personal carbon emissions can seem like trying to empty a lake with the help of a thimble. Is it not the responsibility of companies and governments to make the changes that are necessary to reduce our impact on the earth's climate?
In fact, individuals have collectively greater power in their consumption choices. We can see that this is the increasing use of sustainable items rather than disposable products. This is the very definition of how consumer choice can affect how companies behave. In the same way, by avoiding NFTs, we can send a message that they are not appreciated by the public, which would result in smaller NFTs being embossed.
Airlines have a massive carbon footprint. Why are they OK, but not NFT?
At first glance, it may seem that NFTs are unfairly targeted simply because they are new, but the fact is that there has been a lot of pressure against carbonization globally for some time. After all, that's what the Paris Agreement is about. And industries have innovated in many ways to reduce the amount of carbon emitted to reverse climate change and avoid a climate crisis.
So we can take the steps necessary to increase sustainability, whether it means walking rather than driving, avoiding beef and airplanes or avoiding NFT. But the real question that needs to be answered is whether an activity or product, such as an NFT, is an acceptable creation given its cost.
NFT can make a rich
Many people still choose to fly and eat beef, as they experience slightly greater value in these activities compared to the activism necessary to combat climate change. Of course, they may change at a later time, if more evidence is presented that their behavior harms our planet. Or about the pressure that the decarbonating liquid makes airline tickets and beef too expensive, which can dramatically reduce their use.
The same can be said about NFTs. Whether you choose to participate in the NFT ecosystem depends on your own decisions regarding the need to reduce carbon dioxide emissions. It will also revolve around the options available to you. What are these options?
Options to reduce our carbon footprint
Coal displacements
Carbon dioxide emissions are payments made to finance a project that reduces carbon dioxide emissions or removes carbon dioxide from the atmosphere. The theory is that a government, a company or an individual can buy offsets that match their carbon dioxide emissions and thus eliminate the emissions. Although this seems to be a perfect solution to the problem of large carbon footprints, experts have warned that carbon offsets should only be used when there are no better alternatives.
The warning comes because the use of carbon offsets also raises the question of starting new carbon-intensive activities simply because carbon offsets are available. It's nasty thinking at a time when the world should be looking for ways to reduce emissions whenever possible. It has also been shown that projects with carbon dioxide compensation do not always work as intended, which makes them unreliable. In some cases it can take decades to compensate for the carbon that is emitted, and in other cases the carbon that is now saved is simply released later into the atmosphere and provides no long-term benefit.
How about NFT with low carbon emissions?
The Ethereum blockchain used to emboss NFT uses a mechanism called Proof-of-Work (PoW) to verify that transactions are legitimate and store data. It is this PoW mechanism that leads to the extremely high energy consumption of the Ethereum network. However, there are alternative mechanisms that can be used, such as Proof-of-Stake (PoS), which are much less energy intensive. In fact, several blockchains that also support NFT (such as Polygon and Tezos) already use the PoS mechanism and have much lower energy consumption compared to Ethereum. For example, Tezos has an estimated annual energy consumption of 0.00006Twh, compared to 33.57Twh for Ethereum.
Ethereum is moving to the PoS mechanism itself, and deposit has already begun for the network, and although there is no set date for the full move to PoS, the Ethereum.org website says it is expected to occur in 2021 or 2022. It will reduce the carbon footprint of NFTs significantly.
Some have also said that PoW blockchains can also be considered acceptable if they run on a renewable energy source such as wind or solar. In fact, a study done by Cambridge University 2020 showed that 39% of the energy used by PoW blockchains is already renewable energy. The researchers also concluded that this number may increase in the future.
We must remember that no matter which blockchain we are considering, total electricity consumption is not the only factor in the carbon footprint and environmental impact. As cryptocurrencies become more popular and move into the mainstream, the number of miners and players will increase. This will mean that more computer hardware will be used for cryptocurrency use, and this hardware has its own carbon footprint derived from the manufacturing and extraction processes. This means that the estimates of the carbon footprint of NFTs are already higher than previously thought, and that it can remain quite high even in a PoS blockchain.
Conclusions
At the end of the day, the energy consumed for NFT is a very small part of all global emissions. It is even a small fraction of the total energy used in blockchains alone. And yet, our actions in the NFT space will reflect the kind of mindset needed to succeed in reversing climate change.
The good news is that many of the potential corrections for carbon dioxide emissions problems seen with NFT have already been worked on, they only need to be increased in many cases. Which is true of the whole carbon neutral movement. And although a solution has not yet emerged, there are many artists and even environmental activists who are optimistic about the NFT. They believe that emissions in the next year or two will be a problem for the NFT space.
In the end, it is the artists themselves who have been most vocal in achieving change. They have the power, and if the NFT marketplaces do not meet their requirements, they can easily stop bargaining NFT or move to an alternative marketplace where NFT is characterized by the "cleaner" blockchains.
Already some artists offer bounties to those who can find new ways to improve the durability and carbon footprint of NFTs. It is a perfect example of society dealing with the problem on its own terms rather than ignoring it and hoping that someone else will eventually solve it.