NFTs have become incredibly popular over the past few years. So that every day we see that many celebrities, artists, and famous people produce their NFT collections or invest in this emerging market by buying NFTs.
For example, you can see some of the most expensive NFTs bought by famous people:
- Snoop Dogg bought Right Click and Save As guy from the XCOPY collection for 1600 Ether or $7,088,229. (source)
- Gary Vaynerchuk bought CryptoPunk #2140 for 1,600 ETH, worth $3,956,216, in July 2021. (source)
- Steve Aoki bought Doodle #2238 for 269.69 ETH or about $862,056 in January 2022. (source)
- Logan Paul bought 0n1 Force Bumblebee in February 2021 for 188 ETH or $624,669. (source)
- Neymar Junior bought BAYC #5269 in January 2022 for 186.69 ETH, which was $569,531 at the time. He also bought BAYC #6633 on the same day, paying $1.05 million for two BAYC NFTs. (source)
But next to this buzz of the increasing popularity of NFTs, you must have heard that NFTs are harmful to the environment.
The method used to create an NFT consumes a lot of energy. Electricity consumption for the mint of an NFT means more production of carbon dioxide in the earth’s atmosphere and, finally, climate change. Join us in this article to explain how minting an NFT affects the environment and what solutions exist.
NFTs themselves do not directly affect the environment. Instead, it is the production method of NFT that harms the environment. Today, many tokens are based on the Ethereum blockchain. Until September 15, 2022, the Ethereum network operated on a Proof-of-Work (PoW) algorithm. This method requires a lot of energy to validate transactions. But how is this energy consumed?
In the first step, an NFT is listed in one of the NFT marketplaces, such as OpenSea.
Second step: Buying NFT. Digital currency miners must record and solve extensive and complex calculations so that mining is done and the purchase of NFT is recorded in one of the blockchain blocks. This whole process requires energy.
The third step is NFT storage and transfer. Storing an NFT in the wallet does not consume energy, but transferring it to other markets or another person means using the PoW algorithm, equally to consuming energy to transfer the NFT.
In all these steps, some miners confirm transactions by consuming electricity. Miners, a set of circuits, were designed for computing operations. These circuits are installed on special boards and are used as special devices with high computing power to solve complex mathematical problems. These calculations consume a lot of electricity.
But don’t worry! There are also methods to produce NFT that do not harm the environment, which we will explain further. Before that, you should know that the electricity used to create an NFT with the PoW algorithm equals the electricity consumption of 9 days of a family in America and one month of personal electricity consumption in Europe.
Also, as we said before, some methods make the production of NFT not harm the environment or minimize the damage to the environment. Not all blockchains work with the PoW algorithm. The Proof-of-Stake (PoS) algorithm requires high-end computers to handle the calculations. But to share cryptocurrencies, confirm NFT and confirm digital transactions, you can use the PoS algorithm.
Blockchains like Polygon, Solana, Flow, and Tezos use the PoS algorithm. This method does not require any giant miner. Because it keeps mining equipment and receives and confirms transactions using powerful nodes.
Even the Ethereum blockchain made this change in its system in September 2022 with the name Merge Upgrade and changed its work algorithm from PoW to PoS. After this change, each transaction consumes as much electricity as watching TV for 20 minutes.
So far, the Polygon network has set aside 20 million dollars to compensate for the damage caused to the environment. It has also published a green statement in which it has mentioned the issue of “Carbon Negative”. Every NFT in the Polygon network will not negatively affect the environment.
This network has recently published news that the analysis shows that 99% of the carbon emission in the Polygon network in the past was due to the connection of this network with the Ethereum main network. In this regard, it has invested 450 million dollars to find solutions for scaling the network to reduce the environmental damage to zero.
For example, the Bored Hamster NFT project is based on the Polygon blockchain. One of the reasons this project was designed and produced based on the Polygon blockchain is the concern about environmental damage to neutralize the issue of climate change, which is the biggest threat to Web 3.0, according to the Polygon network. Therefore, you can invest in this project without worrying about harming the environment.
In general, this article talked about the concerns and losses of the NFT world and the solutions implemented to reduce these environmental losses to zero. Of course, keep in mind that the world’s physical systems cause thousands of times more ecological damage due to current costs, paperwork, etc. Of course, with the spread of NFTs, many of these cases will be removed forever. Hoping for an evergreen world 🌱
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