Photo Courtesy of Canva
Chances are if you follow any artists or environmental activists on social media, you’ve heard about the recent phenomenon of Non-Fungible Tokens, or NFTs, and the startlingly large impact they have on the environment.
To give a summary, an NFT is essentially a digital signature used to trace the ownership of a digital asset back to the token’s owner. The NFT is not interchangeable with others, making it unique. The NFT on a JPEG of a cat is different from an NFT on a PNG of a dog, and can be used to tell who “owns” what.
One of the biggest issues with NFTs comes from their impact on the environment. NFTs are stored through the use of a blockchain, with each transaction consuming energy.
Ethereum, the most popular platform for NFT’s, has been estimated by Digicomonist, a website which looks at consequences of digital trends, to use roughly 78.5 kWh for each transaction. TO give you an idea, this is the equivalent of more than two and a half days of the energy used by the average American household, as estimated by Digicomonist.
This is largely caused by how the NFT is generated. When the NFT is purchased, it needs to be verified through a process called mining. Multiple miners will compete to produce the NFT, and while only one person ends up with the commission, all of them are using up energy.
Some supporters of NFT, and cryptocurrency in general, justify this use of energy by comparing it to the amount of power usage and pollution from other sources. NFT’s consume a lot of power, but they don’t necessarily produce the same amount of CO2 as, say, the beef and dairy industry. But one of the key differences is in what is actually produced.
Beef and dairy may have way too large of a carbon footprint for their own good, but they at least provide food to millions. Without something ready to go to replace them, just outright stopping or massively scaling back on them would lead to some issues.
But what does an NFT really provide? Not much to be honest.
The main claims for NFTs are that it allows someone to own an asset and that it’s a way to support various digital artists. While these are both true, they come with a lot of asterix’s that make the idea a lot less appealing.
For one, while you own the asset, you don’t necessarily own the copyright to the image. People can still access the image as long as it’s publicly available, and there’s nothing really stopping someone from downloading it for personal use. All you really own is the right to display the asset.
Essentially, you’re buying a voucher that says “I own this PNG of a box of animal crackers.” You can show that image on your website if you have one, but you can’t charge people to see it. You can’t make a deal with a company to use that image. You can essentially say “I have permission to show this off.”
The uniqueness of an NFT is also a bit exaggerated. While it is true that no two NFTs are the same, an asset can still have multiple NFT’s attached to it. The NFT acts more like a serial number for your copy of the asset.
There’s also a serious issue a lot of supporters of NFT have seemingly avoided when it comes to digital art. Most images are too large to be stored in a blockchain, and as such the NFT is attached to the web address of the image. That means if that web address gets shut down, that NFT may as well not exist anymore.
The use of artist support as a defense of the tokens is also one that rings pretty hollow. Yes, you can buy the right to display the image with an NFT, but you know how else you can do that? You can commission an artist for an image. Depending on where it’s being displayed, you can work out an arrangement with the artist.
Another massive issue is that there is little to no form of copyright protection with NFTs. Tons of artists have had NFTs of their art sold off without their consent. While some of these people will at least feign wanting to share revenue with the artist, many more have refused to pull the stop minting peoples art even when expressly told to.
For a lot of artists, this has led to concern about sharing any art with the public, for fear of it being sold over a system they may not support. The problem is for a lot of independent artists who share their art publicly to advertise themselves may not have a choice but to accept their work is being stolen.
It should be noted that, in the last couple months that NFTs have skyrocketed, there’s been this constant vibe of it being a way to scam people. Yes, some people have made millions selling NFT’s, but what’s a lot more common is for someone to buy one and be unable to sell it for a price that will make a profit.
Combine this with notable figures like Elon Musk bragging on social media about how he was able to make big bucks selling NFTs, and it has the same stink as a pump-and-dump scheme you see with the stock market. Tell everyone how awesome NFTs are, get prices up, and offload what you have.
While some have been trying to find ways to produce NFT’s in a more energy efficient manner, it ultimately doesn’t change the problem that they ultimately don’t really provide anything of worth. When commissioning an artist or licensing their work is already an option, there really isn’t a point in buying what is essentially a digital receipt.
The NFT craze is ultimately an overcomplicated answer to a simple problem. If you want to support an artist, then support them by paying them, not a bunch of crypto miners.