NFTs are non-fungible cryptographic tokens. They are coded on the blockchain like cryptocurrencies, such as bitcoin. Unlike these, NFTs cannot be exchanged for other NFTs: they are completely unique.
Knowing that the carbon footprint of cryptocurrencies is particularly heavy, the question also arises for NFT, whose production principle is substantially comparable. Let’s see point by point how NFTs impact the environment:
Purchasing an NFT:
In order to obtain an NFT you must use cryptocurrencies and not fiat currencies. The carbon footprint of NFTs is therefore added to that of cryptocurrencies. The production of bitcoins is particularly polluting. The more a cryptocurrency is used, the slower and more energy-intensive the mining process (producing the token) will be.
A very powerful machinery system is required in order to produce NFTs; they must be able to perform very complex calculations. These types of mining processors consume about 91 terawatt hours of electricity per year, which is about the consumption of Finland.
The creation of the NFT:
NFTS are mainly offered for sale on Opensea. This is good news from an ecological point of view, because this platform uses a different technique from mining. This token creation technique is proof of stake (and not proof of work, like bitcoins). The proof of stake is much faster and takes much less time to create; this is the technique used to develop Ethereum tokens.
Although the proof of stake technique consumes less energy, it still consumes a lot of electricity. Creating a standard NFT comes with an impressive carbon footprint. According to the New York Times, the production of a single NFT would represent more than 200 kilos of carbon dioxide, the equivalent of a journey of approximately 800 kilometers of a classic American gasoline car.
Green NFTS: marketing illusion or reality?
Faced with criticism of the ecological footprint of NFTs and cryptocurrencies, new ecological approaches are underway. Some blockchains such as Tezos for example, are starting to use only renewable energy to power the mining and production of crypto-currencies.
A new climate agreement has just been created in April 2021, aimed at reducing the carbon footprint of crypto-currencies: the crypto-climate agreements. Unfortunately, they do not allow the purchase of crypto-currencies or NFTs that would be certified “green”. Using more renewable energy seems to be a real step in the direction of an ecological approach, but it will not change the problem of the overconsumption of electricity that NFT’s require. Green energy or not, NFT’s consume too much energy.
NFT’s are intrinsically linked to cryptocurrencies. It’s a pity that virtual works of art are so costly in terms of energy when they have no materiality. The impact of NFTs is therefore just as similar as for cryptocurrencies. Fortunately, there are a plethora of new green initiatives aimed at reducing the environmental cost of cryptocurrencies and NFT’s. Knowing that cryptocurrencies are not ready to disappear, it is essential to find solutions to regulate and drastically reduce the impact of cryptocurrencies.