NFTs have created a digital marketplace for art Oleksandra Troian/Alamy
Non-fungible tokens (NFTs) have risen in popularity in recent weeks as a way to sell artwork using blockchains, the technology behind cryptocurrencies like bitcoin. Now, two of the developers behind the NFTs at the root of the current digital art boom have warned that they are damaging to the environment and that a change in direction is needed.
An NFT is a cryptographic claim of ownership, similar to the deed to a house, that is encoded into a blockchain, meaning that it cannot be altered.
William Entriken, one of the , a popular alternative to bitcoin, says NFTs aren’t inherently bad, but that rapacious speculation is pushing them and cryptocurrencies down a destructive path as their carbon footprints rise.
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Most cryptocurrencies rely on 鈥減roof of work鈥 to secure their networks, meaning that computers must perform huge numbers of calculations to 鈥渕ine鈥 new currency and verify transactions on the blockchain. This uses large amounts of electricity 鈥 .
Investing money into cryptocurrencies – either through simple speculation or by purchasing expensive artwork – boosts demand and therefore prices, says Entriken. That makes mining that cryptocurrency more profitable, but also more difficult, increasing carbon emissions.
Entriken contrasts cryptocurrencies with carbon offsetting, in which people pay to have carbon emissions removed from the atmosphere. 鈥淏itcoin is the opposite of that. When you purchase bitcoin you鈥檙e purchasing carbon creation credits,鈥 says Entriken. 鈥淲hen you purchase the $50,000 [of bitcoin] somebody else is directly putting that much carbon into the atmosphere. Ethereum is the same.鈥
He has called for Ethereum to switch from a proof of work (PoW) approach to a proof of stake (PoS) approach, which would remove the need for intense calculations by allowing the owners of existing coins to control the network, rather than the owners of the computing power. It is estimated this could cut the total energy demands of Ethereum . 鈥淵ou have to switch to proof of stake. Proof of work should be illegal,鈥 says Entriken.
Ethereum developers have been working to make the switch for some time, but no single person or organisation is in charge of the open source project, meaning progress has been sporadic, says Entriken. 鈥淚t鈥檚 always been three months away. These things don鈥檛 just happen immediately.鈥
“The carbon footprint of proof of work blockchains deserves all of the criticism it gets and more,鈥 says Dieter Shirley, who also worked on the Ethereum NFT protocol. 鈥淏ut NFTs are not the problem here. Now that we have electric cars, we can say that cars aren鈥檛 the problem, gasoline is the problem. Same with proof of stake: now that we have PoS blockchains, we can say that NFTs aren鈥檛 the problem, PoW chains are.”
Increasing awareness of the carbon cost of NFTs has inspired some artists to look elsewhere. French artist Joanie Lemercier began selling NFT artwork on Ethereum as an alternative to the emissions involved in shipping physical artwork, but soon stopped. 鈥淚 was trying to find something better, and I thought NFTs would be it,鈥 he says. 鈥淏ut it鈥檚 10 to a hundred times worse, so it makes no sense.鈥
He says that websites selling NFTs need to take the initiative and switch to technologies that have already adopted proof of stake. 鈥淭he platforms should be held accountable and responsible and they should address the issue, because they can,鈥 says Lemercier.
Lemercier has been exploring alternatives and is currently selling pieces via a . 鈥淚t works absolutely great. There’s no reason to remain on Ethereum. The big money is going to come where the artists are,鈥 he says.
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