An Ecological Nightmare Pyramid Scheme
Non-fungible tokens (NFTs), which are individual pieces of crypto art, are at least partially responsible for the millions of tonnes of planet-warming carbon dioxide emissions generated by the cryptocurrencies used to buy and trade them. Some artists, especially those who have already profited from the fad, believe it is a simple problem to address. Others believe the recommended solutions are unrealistic.
After receiving a lot of feedback from those who believe dealing in crypto art is unethical, ArtStation, an online marketplace for digital artists, abandoned its plans to offer a platform for NFTs within hours. On Twitter, artists referred to NFTs as a “ecological nightmare pyramid scheme” and ArtStation’s attempts to offset emissions as a “scam.”
The Dirty World of NFTs
An NFT is a one-of-a-kind cryptocurrency token that can be anything digital, including art, GIFs, and even Twitter CEO Jack Dorsey’s first tweet. (For a more in-depth explanation of what an NFT is, see this breakdown.) There have been some preliminary estimates of how much electricity an NFT consumes and, as a result, how much global warming pollution it produces.
Take, for example, “Space Cat,” an NFT that is essentially a GIF of a cat in a rocket travelling to the Moon. According to the website cryptoart.wtf, Space Cat’s carbon footprint is the same as an EU resident’s electrical usage for two months. Until March 12th, when its developer Memo Akten took it down, the website allowed anyone to scroll through the estimated greenhouse gas emissions connected with particular NFTs. Akten, a digital artist, looked at 18,000 NFTs and discovered that the average NFT has a carbon footprint that is slightly smaller than Space Cat’s, but still equal to more than a month’s worth of power for someone living in the EU. Some folks were taken aback by the figures. However, Akten discovered that the website had been used to incorrectly assign the emissions of an NFT marketplace to a single NFT. According to a note on the site, he took the site down after discovering that it had been “used as a weapon for abuse and harassment.”
Airlines and NFTs
When someone uses Ethereum to create, buy, or trade an NFT, they are accountable for a portion of the emissions produced by the miners. The question of whether NFTs are considerably boosting Ethereum emissions or simply taking on responsibility for emissions that would have been generated by miners anyhow is currently being debated. Miners would still be working on puzzles and pollute without NFTs. And NFTs account for only a small percentage of total Ethereum transactions.
An alternative to Ethereum
There are other ways to keep a blockchain secure that aren’t as harmful to the environment. A mechanism known as “proof of stake” is the most common alternative to proof of work. The Flow blockchain, which is an example of an arguably more centralized blockchain based on the proof-of-stake architecture, is used by NBA’s Top Shot, the marketplace where basketball fans can buy NBA highlights as NFTs. To deter negative behavior, this system still requires users to have some form of stake in the game. Rather of paying a large sum of money to join the game, they must deposit some of their own cryptocurrency tokens in the network to “show” that they have a “stake” in maintaining the ledger accurate. If they’re caught doing something questionable, they’ll lose those tokens. This eliminates the need for computers to answer complex riddles, resulting in a reduction in emissions.