In this article, you will learn about a subject that no one likes talking about the environmental impact of non-fungible tokens or NFTs. We take an in-depth look into the carbon footprint of blockchain technology, and we break down every what hour of energy consumed in processing NFTs from creation to sale.
We wrote this article to provide a factual, unopinionated view based on a recent study, with the idea to spark a well-informed conversation. Things to know before we start. And if TS briefly defined NFTs are a way to verify true ownership of a digital item by attaching a unique key to it via a process called minting. When an NFT is minted, data that represents ownership is stored on a blockchain network, and whoever started the minting process is given the key that unlocks the ownership data on the blockchain. When you buy an NFT, you buy the only verifiable version of the item. This naturally increases its value because the item is unique in comparison to its copies that are non NFT versions. Power consumption of blockchain technology NFT data is stored on the blockchain and through the proof of work mechanism. Data blocks are checked by miners in order to reach consensus about the integrity of the data. This process is what makes blockchain technology highly secure and decentralized. But the continuous data checks cost computational power. Regular blockchain usage, such as trading cryptocurrencies, require simply put to actions currency in registration and currency out registration. In the case of NFTs, multiple blockchain data blocks are added, which in comparison with regular usage, requires more checks.
The ecological cost of keeping track of all these amounts to the energy usage of six million one hundred fifty four thousand seven hundred seventeen kilowatt hour, or roughly six gigawatt hours, and emissions amounting to 3.8 metric tons of CO2. This is equivalent to two thousand years worth of electrical energy consumption by a single person in Europe, or a driving for 20 million kilometers or flying for 37000 hours. Keep in mind that these numbers are only for one of many NFT marketplaces and also based on numbers at the beginning of the NFT revolution. Chapter four Solutions Lower Carbon NFTs The fundamental reason for the high energy consumption of blockchains like Ethereum and Bitcoin is that they use a consensus mechanism called proof of work. Proof of work is an excellent system to verify data integrity. But as global adoption of blockchains that use proof of work technology increases, so does the power consumption by miners to verify the data. Other blockchain variants that offer NFT support, such as Tezos Symbol and Polygon, all make use of the improved proof of stake mechanism that does not require large amounts of computing power and therefore use less electricity. Tezos, for example, claims that their blockchain uses only zero point zero zero zero zero six terawatt hours of energy per year, compared to thirty three point three five seven terawatt hour for Ethereum. However, there is good news for Ethereum fans with ETH 2.0. A greener proof of stake upgrade is proposed for the current Ethereum ecosystem.
Ethereum plans to bring down the costs, as well as the ecological impact of not just TS, but the Ethereum blockchain as a whole by as much as ninety nine point ninety eight percent carbon offsets.