NFTs (Non-fungible tokens) hold an enticing prospect for artists: The opportunity to monetize art and music directly on a large scale in the digital realm is unlike anything we’ve ever seen before.
That being said, foundational blockchain technology comes at the cost of staggering greenhouse gas emissions. Is it possible for artists to protect the Earth and still monetize their lifelong works?
Below, we’ll detail everything you need to know about the future of NFTs and how it intersects with the state of the environment.
How Do NFTs Work With Art?
Before diving into the environmental impact of NFTs, let’s do some groundwork: How does an NFT work in the art world?
An NFT can be defined as an asset on a blockchain that’s distinguished by unique data and an identification code that can hold a varying amount of value based on the market. This decentralization of digital goods makes it possible for musicians and artists to monetize their works in a variety of ways.
Artist NFTs can also be resold -- so it’s a direct way for fans to benefit from investing in you as you grow as an artist.
The Issue With NFTs
So, decentralization and monetization for artists and an unlimited amount of industries, it all sounds great, right? Unfortunately, the storage and encryption of data surrounding NFTs comes at a hefty cost: An incredible amount of energy and therefore, emissions in a world already starved by the climate crisis.
To offer some perspective, the French artist Joanie Lemercier sold a NFT of a digital rendition of a “platonic solid” . Unfortunately, the sale took up 8.7 megawatt-hours of energy, or the energy equivalent of two years in Lemercier’s studio despite the fantastic monetization for the creator. The artist went on to cancel his future drops with blockchain Ethereum out of concerns for the environment.
Other artists had different approaches upon discovering the impact of a Etherum-based NFT. The digital artist “Beeple” who made a killing with his art NFTs pledged to offset energy costs by investing in renewable energy and conservation projects.
Thankfully, many blockchains are noticing the demand for a cleaner system, and a lot can be gleaned from the two main methods of running the chain:
The Proof of Work Method (PoW)
This method is more or less the source of the environmental problem with most popular cryptocurrencies like Ethereum. Proof of work is entirely self-reliant, so keeping data fully secure ends up being purposefully energy intensive for security purposes. This method embeds complex puzzles to protect transactions and is grossly inefficient.
The Proof of Stake Method (PoS)
This slightly more centralized option is a much more efficient method in terms of energy consumption, making it a priority for environmentally-concerned blockchain shoppers. Proof of stake requires users to leverage transactions based on the amount of cryptocurrency they have available. The amount of coins you hold allows you to have “stake” in the game and therefore discourages unsavory behavior.
Since the complex puzzles aren’t needed for validation in PoW, a ton of energy is saved. Unfortunately, some of the most popular platforms like Bitcoin and Ethereum continue to operate on PoW despite promising to adapt to PoS in the near future.
Carbon Neutral Platforms to Keep An Eye On
While we are just beginning to figure out how to make NFTs fully sustainable, there are some promising players within the business that may be worth considering for your art.
Opulous
Opulous is a promising platform that allows fans to invest in the music copyright of a song. These shares can be kept or resold, growing alongside your favorite up and coming acts. It also utilizes the carbon neutral blockchain Algorand.
Aorist
Aorist is also powered by Algorand and “invests their own capital to offset twice the carbon emissions generated by our day-to-day operations” for environmentally-concerned artists. While this platform mainly showcases visual art, it’s certainly worth keeping an eye on.
Voice
Voice is one of the most promising prospects for any musician, offering free creation of your song or art piece’s mint. The platform utilizes proof of stake to cut emissions, acting as a carbon neutral platform for artists.
OpenSea
OpenSea is one of the largest NFT marketplaces. While some of the NFTs on OpenSea are minted with Ethereum, you can opt to mint via Polygon which takes up much less of a carbon footprint than the former.
ARIA Exchange
While ARIA Exchange hasn’t dropped just yet, the platform promises a fully carbon negative platform to buy and sell collectibles within the fields of art, design, and sports.
In short, the future of NFTs and sustainability remains to be seen. While it’s clear that there are some unsustainable ways to run a blockchain, it’s promising to see many creators seek out new technology so that carbon neutral marketplaces hopefully become the bare minimum across the industry.