NFTs are a hot topic right now, but are they heating up the planet at the same time? We look at the environmental controversy around crypto art.
What is Crypto Art?
You’ve heard of cryptocurrencies such as Bitcoin and Ethereum. Digital currencies that enable you to purchase goods and services, that are also used heavily in trading and investing. Well, crypto art follows a similar concept that is also linked to blockchain technology, just like the currencies. You might recognise crypto art better when it’s referred to as an NFT (Non-Fungible Token). These have blown up recently, with more and more artists selling their work in digital form. One of the first examples is Grimes selling $6m worth of digital art as NFTs.
What is the Eco Impact?
Now, as this phenomenon is purely digital it can be confusing to think it has an environmental impact. No trees are being chopped down, no harmful resources are being produced and used. But, even the use of computers have a carbon footprint, and the computers needed to process the world of crypto art and currencies are massive. In fact, cryptocurrencies are responsible for producing millions of tons of planet-heating carbon dioxide emissions.
In terms of the art itself, Space Cat (a hugely expensive NFT GIF) allegedly has a carbon footprint equivalent to that of 2 months’ worth of electricity usage from an EU resident. It’s been found that this is generally the carbon footprint of most NFTs, which is somewhat concerning as NFTs continue to boom. However, it is worth noting that this data has not yet been verified by outside experts, due to the newness of crypto art.
The emissions and impact come largely from the act of “mining” for cryptocurrencies to buy the art with. The energy hungry security systems used to protect transactions requires “miners” to solve complex puzzles. This then lets them add a new “block” of verified transactions to a decentralized ledger called the blockchain. Head spinning yet? This is just the beginning. This whole system is deliberately energy inefficient. The thinking behind it is that using heaps of expensive electricity makes it less profitable for someone to muck up the ledger, kind of like a carrot and stick situation, with this being the stick. Ethereum, as a result, supposedly uses the same amount of electricity as the country of Libya.
There is a lot of disagreement and speculation about what kind of energy powers these huge verifying systems, like Ethereum. Some estimates have suggested that up to 70% of digital mining activity is powered by “clean energy”. However, this statistic shifts frequently, and it’s difficult to know which information sources around this are reliable.
Is There a Solution?
You may be wondering whether there are any realistic solutions to this extra pressure that’s being put on our already strained planet. There is much discussion around this, with some big hitters claiming they have more eco-friendly plans in the works.
Ethereum’s developers have been planning a less carbon-intensive form of security, known as proof-of-stake. However, this has been discussed for years, with no sign of a set deadline or timeframe for the move. There are already some alternative blockchains using proof-of-stake, but they are viewed by buyers as less established and less permanent. For those spending millions on digital art, permanency and reliability is a huge factor, so a move to a wider use of proof-of-stake could be slow and tricky.
With the negative ecological impacts of crypto art unclear yet evident, it remains to be seen whether artists will take this into account before selling their digital art.