Non-fungible tokens, or NFTs, can be anything digital, like a drawing, a song, or even your brain and downloaded to be turned into a one-of-a-kind digital signature or “token” – that’s what non-fungible means – powered by a blockchain. NFTs are usually made by Ethereum or other lesser-known blockchains. In all cases, those blockchains monitor NFTs and keep track of who holds them and trades them.
However, most of the excitement right now is about using the technology to sell digital art. This may come as a surprise: We always think of art as one thing-of-a-kind that is done by an artist, his own work and not as some digital product sitting on a blockchain. But with the NFT process, they do become one-of-a-kind, just like any regular piece of art.
As it turns out, NFTs are a pathway to provide us and many artists around the world with a new way to connect and interact in spite of the global pandemic we are still facing.
For example, with the help of NFTs, the Wombats have been able to give their fans exclusive content and experiences, like a virtual concert in the metaverse.
But, are they really sustainable?
Every business, whether in the music industry or not, is now expected to adopt a proactive approach to climate change. Being ahead of the curve in terms of sustainability is a need, not a luxury.
One of the most serious difficulties of the climate catastrophe is “energy consumption”, and Russia’s invasion of Ukraine has further aggravated the situation.
The exponential rise of the digital world has raised real worries about the amount of energy necessary to power it. Although virtual rather than physical products and experiences appear to have a lower environmental effect, they require massive amounts of electricity to enable data transfers and storage.
A typical NFT transaction is estimated to have a carbon footprint of around 48kg of CO2, which is not ideal. To put this into perspective, one NFT transaction is expected to have a carbon footprint 14 times that of producing and shipping an art print.
What are those top tips for going green with NFTs ?
Because it does not necessitate the large use of computational gear, the proof-of-stake approach consumes less energy than proof-of-work. Ethereum, which presently handles the vast majority of NFT transactions, will switch to the proof-of-stake technique in 2022.
The main difference between the two approaches is that proof of work requires miners to use a lot more computational power, while proof of stake requires users to show ownership of a specific amount of cryptocurrency.
By purchasing renewable energy to fuel the energy needs of your NFT and other crypto assets, you may eliminate or reduce the related carbon emissions.
Investing a percentage of the revenues from NFT sales in renewable energy projects (wind, solar, and other) produces additional capacity to help decarbonize the whole energy system.
Purchasing carbon offsets from trustworthy suppliers will have no effect on the energy provided by cryptocurrencies, but it will mean that you are supporting programmes to decrease or capture emissions elsewhere in the globe.
Tree planting and renewable energy capacity are popular carbon offset initiatives in emerging economies. The latest example is Gabon’s new plan for the world’s largest-ever issue of carbon credits, fully 187 million, almost half of which will be sold on the offsets market. Of note: Gabon is the world’s most forested country after Suriname – this surely will help provide credits for those whose activities are weighing down on the environment, the case of NFTs.
How long this can go on is open to question: Clearly, at some point, the limit will be reached and NFTs holders will need to live within the confines of carbon trading markets, or risk being accused of greenwashing.
Editor’s Note: The opinions expressed here by Impakter.com columnists are their own, not those of Impakter.com. — In the Featured Photo: NFTs and everything you need to know about it Featured Photo Credit: Iterators