To NFT or Not To NFT?
By Danial bin Fuad

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What is NFT?

Non-Fungible Tokens (NFT) have taken the art world by storm. In early March, Christie’s sold Beeple’s NFT work for a whopping US$69 million (~RM285 million). NFT, in simple terms, is like a certificate of authenticity for digital works. It is proof of ownership of a work, recorded in a digital ledger called a blockchain, similar in concept to acquiring a physical painting, which you would then hold in your own storage. The work can then be sold off later if the need arises.

The first step for an artist to get their feet into the NFTs world is to have a crypto-wallet that enables one to trade in crypto currencies. After that, they can select one of the various available NFT marketplaces, the most popular now being OpenSea. This is where they can “mint” their works as NFTs (adding in details of the works) and connect them to the wallet before putting the works up for sale. NFTs allow the artist to determine their own royalties, placing the power to benefit from subsequent sales into the hands of the artist - something quite rare in the traditional art world.

Impact on environment

While NFTs can potentially benefit the artist, there is a downside. NFTs use blockchain technology to verify identity and ownership, with proof-of-work as security. For traditional currencies, banks oversee each transaction, but the whole point of crypto currencies is to bypass the traditional banking system. The proof-of-work is a system created to supervise each transaction. This step requires a lot of processing power to solve complex mathematical equations, hence, the need for a lot of energy.

Proof-of-work needs to be carried out on every NFTs transaction, making it a power-hungry ordeal with a large carbon footprint, as can be seen on the now-defunct cryptoart.wtf website. On average, each NFT transaction can consume as much power as a month’s worth of electricity for people in the European Union (EU). The most power-intensive crypto currency right now is Ethereum, with which most NFTs are traded. To offset the cost, each NFT transaction comes with a “gas fee”.

Reducing carbon footprint

One way to combat the carbon footprint issue is to change proof-of-work to proof-of-stake. Instead of solving mathematical problems to make sure the transaction is secured, one only needs to set aside some crypto currency as a collateral. This move removes the necessity of supercomputer processing to solve the equations. Ethereum is planning to use this method with Ethereum 2.0, which is yet to be released.

You could also just create a more eco-friendly NFT transaction by using a platform other than Ethereum. Various low carbon NFTs platform are available such as KodaDot NFT Explorer, Viv3 and hic et nunc, to name a few. These platform use proof-of-stake or proof-of-authority as security, significantly reducing the carbon footprint.

Conclusion

The pros of NFTs for artists are obvious, but the onus is on us to push for cleaner NFTs and crypto currencies for a better future. The world is struggling with climate change, and as artists and consumers of art, we won’t help things or keep a clear conscience by making it worse.

NFTs are a fun new way to create art and it helps with how digital artists can distribute their work. Artists need to get a better understanding of the workings of NFTs and really challenge the standards - not just aim to be the next Beeple or Grimes.
I think one of the best things about NFTs is that the artist does not need to get a creative IP to claim their rights to their work. That being said, another problem has arisen recently - stolen work converted to NFTs. But that’s another topic for another article. 

The full list of eco-friendly NFTs platform can be found here: https://github.com/memo/eco-nft#nft-platforms--marketplaces

The views and opinions expressed in this article are strictly the author's own and do not reflect those of CENDANA. CENDANA reserves the right to be excluded from any liabilities, losses, damages, defaults, and/or intellectual property infringements caused by the views and opinions expressed by the author in this article at all times, during or after publication, whether on this website or any other platforms hosted by CENDANA or if said opinions/views are republished on third party platforms.

Danial Fuad is a participant of the CENDANA - ASWARA Arts Writing Mentorship Programme 2020-2021.

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