A digital artist known as Beeple sold a piece of entirely digital art through Christie’s for over $69 million in March, flipping the art world upside down. But the digital registry where that piece of art, called an NFT, is stored is responsible for theof more carbon into the atmosphere than most small countries.
So why is everyone so eager to jump on the NFT bandwagon?
, are original, unique digital collectibles — and they have taken over the art world in the past few months. They hold a unique string of code, stored on a digital ledger known as a , and their value fluctuates depending on demand.
Other people can still view the work online, but buyers are interested in claiming ownership of the original — something that was impossible for digital artwork prior to the development of NFTs in the mid-2010s.
“NFTs are the first way that blockchain technology has connected with a lot of people,” Dieter Shirley, CTO of Dapper Labs, the company responsible for several popular blockchain platforms, told CBS News. “NFTs are the first time we can meaningfully have scarce or unique collectibles as part of our digital lives.”
Artists around the world were thrilled: NFTs provide the opportunity for them to make significant money on their work, reach a broader audience all over the world and link a digital file to a creator, ensuring authenticity. And with theskyrocketing, some think there’s never been a better time to get in on it.
“As our society generally adopts and moves towards technology, and assimilates technology and every aspect of life, it’s only natural for artists, who are commentators on society, to respond and use that medium that’s at their fingertips to kind of explain what’s happening.” Max Moore, who ran the auction house Sotheby’s first NFT sale, told CBS News. “I think it’s just a natural evolution.”
But recently some artists have started to grapple with the environmental costs of the medium.
“With no travel involved, and a mostly digital distribution, this new model looks like it has the potential to become a sustainable practice for artists,” French artist Joanie Lemercier wrote in a viral blog post in February. “That’s until you understand the magnitude of the environmental impacts of the current blockchain: It is a DISASTER.”
That’s because blockchain technology — which is used by cryptocurrencies like Bitcoin and Ethereum — requires a lot of energy, generating a massive amount of greenhouse gases.
What are NFTs?
In order to “mint” a piece of art on the blockchain and become the official owner, an exorbitant amount of computing power and energy is used to solve complex puzzles in a process known as mining., the open-source blockchain that hosts NFTs, uses a purposely inefficient “proof of work” (PoW) method to create these digital assets.
Powerful computers can make an unfathomable number of attempts every second to produce new blocks. Whichever miner gets to the answer first gets their unique asset added to the blockchain.
The “puzzles” get more difficult to solve as the price of cryptocurrency inflates and more computers are trying to solve them. It creates a perpetuating cycle of greater computer power and larger warehouses and stronger cooling units just to keep up — and an exponentially rising carbon footprint.
This amount of work is intentional — it creates a competitive market…