The token space consumes as much electricity as the entire country of Libya. With NFTs, their growing demand and increase in transactions will further point to profit opportunities for miners, leading to more emissions.
A carbon footprint is a rough estimate of all the carbon emissions emitted into the atmosphere during the creation and consumption of a product. There are many factors and factors that influence carbon emissions, from renewable or fossil fuels to the production of a carton of milk. Therefore, as responsible citizens of the world, people now agree that individual responsibility for carbon emissions is essential.
However, since it is difficult to calculate the exact dimensions of these numbers, they usually contain an estimate. However, they are sufficient to calculate the environmental impact of NFTs. According to the Digiconomist website, a single Ethereum transaction consumes over 70.32 kWh, which is enough to power 1 US family for two and a half days. It has also been calculated that the carbon footprint of one Ethereum transaction is 33.4 kg of CO2. According to another interested artist, the average NFT-specific transaction has a carbon footprint of around 48 kg of CO2. However, this is also not the final amount, as each time an NFT is minted or traded, it becomes another transaction with additional CO2 emissions.
If such valuations continue to rise and need to be calculated, a single NFT transaction is likely to have a carbon footprint more than 14 times greater than mailing an art print valued at 2.3 kg of CO2. Thus, Ethereum consumes more energy than any other way to authenticate and sell original artwork. It is said that its annual energy consumption even exceeds that of Denmark.
Now that its popularity has risen, the increase in NFT users and transactions has exacerbated the problem. In addition, it is possible to secure cryptocurrencies such as Bitcoin and Ethereum through a mechanism called Proof of Work (PoW), an energy-intensive mining process. This automatically implies that these blockchains are energy intensive by design.
In addition, buyers have a higher incentive to participate in computing with the rise in cryptocurrency prices. Then additional nodes and stakeholders are involved, which complicates the process and requires more energy. The situation is becoming alarming given the warnings already made by environmentalists and climate scientists. Unprecedented rises in temperature, sea levels, species extinction, severe weather events and other signs of global warming are also increasing the risks associated with this form of data entry and wealth creation methods.
Since November 2017, NFTs have accumulated approximately $174 million. Because of their uniqueness and ability to own a single asset, NFTs have a high value. Beeple (Mike Winklemann), for example, is a digital artist. “Every day: the first 500 days,” he called his work. This is a collection of simple sketches he put together to create an NFT that was sold for $69.3 million.
Jack Dorsey, co-founder of Twitter, sold his first tweet for nearly $2.9 million. Because it was sold as a non-financial transaction (NFT), one person now owns the first tweet from one of the people who founded Twitter. Someone paid $208,000 for a unique digital trading card of legendary lem dunk LeBron James.
To the untrained eye, NFT may appear to be a mechanism to allow creative and hard-working artists to be fairly compensated for their work. It’s possible — every time an artist’s work is bought or sold, the artist receives a percentage of the proceeds. However, NFTs and the energy required to mine and store them are damaging to the environment.
How? NFTs, on the other hand, use Blockchain technology. Unfortunately, this technology consumes a significant amount of energy. Developing an NFT from a real work of art or a digital object requires a lot of energy. And every time an NFT is bought or sold, more electricity is used to complete the transaction. The most common method of selling NFTs is through Ethereum. This system is responsible for the security of the NFT. The programming ensures that the element cannot be copied or stolen, but it consumes a large amount of power in the process.
Ethereum relies on a “proof of work” system. This “proof of employment” ensures that the sales are legal but will use as much power as Libya. “Blocks” are attached to the chain in such a way as to consume little energy. Given the lack of energy, the argument is that fewer people will be willing to risk more of their energy due to erroneous transactions. Instead, they must pay the electricity bill. This is what makes buying and selling NFTs and cryptocurrencies so safe, but also why some critics and skeptics are skeptical about digital assets in general. The more popular and valuable NFTs become.