Ouch, that's expensive!

What's being done to stop NFTs destroying the planet?

Jun 09, 2021

A ‘viral’ video of a boy called Harry having his finger bitten by his baby brother Charlie, has been pulled from YouTube.

Why was this?

Because a few weeks ago it was auctioned off as an NFT for £500,000. The successful bidder now owns the bragging rights to an original copy of the 55-second drama.

But let me stop myself there. I want to talk more about NFTs.

What on earth is an NFT?

Oh, right, non-fungible tokens… cool. I gotcha! A class of cryptocurrency.

OK… so the Verge describes them with this helpful analogy: ‘“Non-fungible” means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible – trade one for another bitcoin, and you’ll have exactly the same thing. A one-of-a-kind trading card, however, is non-fungible. If you traded it for a different card, you’d have something completely different.’

Mashable’s Natasha Mathur says: ‘These items are intangible assets including a video clip (like Charlie bit my finger), audio, and digital art, among other digital files.’

In March 2021, a digital artist called Beeple sold a piece of entirely digital art through Christie's auction house for more than $69 million. In the same month, Jack Dorsey, the founder of Twitter, sold an NFT of his first ever tweet for $2.9 million.

What?!!

It’s further confirmation of how blockchain technologies are developing super-fast and disrupting the concept of a value-exchange.

I first heard about NFTs in a tweet from entrepreneur and digital marketing guru, Gary Vaynerchuk. He compares his excitement towards NFTs with the early days of the internet and Web 2.0. My ears pricked up. Gary has since spoken about them regularly on podcasts, blogs and on his social channels.

I find blockchain tech (which NFTs fall into the category of) really fascinating. Google Docs, which I use to draft my Substacks, is perhaps an example of my favourite blockchain technology.

Not all fun

But, while NFTs may be an exciting economic development, they’re not great for the environment. According to Wired, verifying the validity of NFTs requires ‘a network of computers that use advanced cryptography to decide whether transactions are valid—and in doing so uses energy on the scale of a small country.’

One study claimes Bitcoin emissions alone could push global warming above 2°C. Let that sink in for a sec.

The digital registry, where Beeple’s piece of NFT art is stored, is called Ethereum. Ethereum is responsible for the annual emission of more carbon into the atmosphere than most small countries. It’s because it runs a Proof-of-Work (PoW) basis, and the PoW algorithm is very computer intensive to ‘mint’ (or validate) NFTs.

So where do we go from here?

According to a CBS News report many artists, including Damien Hurst, are working to raise awareness about alternatives to Ethereum and it’s PoW approach.

NFT gurus Artnome are even putting a bounty on attempts to make NFTs greener.

A recently launched online store is now selling exclusively green NFTs.

And Ethereum itself says it’s planning to switch from PoW to PoS (proof of stake) – eliminating up to 99% of the power consumption. They’re calling the move a ‘consensus mechanism’. Basically it means you just rely on groups of stakeholders to verify if an NFT is genuine, and you're not dependent on heavyweight computer power crunching through that verification process… and killing the planet.

So, that’s quite a lot to think about in this edition of Digital Wisdom.

I’m no expert on NFTs and the like, but I do find them totally fascinating – what they mean and how they are such a change-making tech development.

Let me know what you think, leave a comment here or connect with me on LinkedIn.

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