June 24, 2020
By Anjali Kochhar
It’s very common to read about non-fungible tokens (NFTs) impacting the environment in a bad way because of the way they are created. Most NFTs are minted using the proof-of-work operating method, which uses an intensive amount of energy. It’s rare to see NFTs that can actually help in fighting climate change but not impossible.
Climate change has become a problem that the world has been fighting for years. It includes both global warming and its impacts on Earth’s weather patterns. There have been previous periods of climate change, but the current changes are distinctly more rapid and not due to natural causes. Humans have their role to play. The more the amount of greenhouse gas emissions in the environment, the worse the state of the environment is becoming day by day.
Adding to the previously known causes of these emissions in the environment, NFT minting through proof of work mechanism has become a problem. However, it is noteworthy that blockchain platforms using the proof-of-stake operating method can generate NFTs without excessively using electricity and negatively impacting the environment.
The proof-of-stake method uses less energy than proof-of-work because it does not require the extensive use of computing hardware.
Impact NFTs are designed using a proof of stake or negligible carbon minting process. This ensures that a token is environmentally considerate and may even be climate positive.
An Impact NFT is also different to a regular NFT in that it is designed to fund positive social or environmental impact, acting as a digital asset for impact investing.
To better understand how NFTs can help fight climate change, NFT Metta spoke with crypto experts and here is what they had to say.
Rica Amaral, Head of Marketing & Creative Strategy, ProjectArk, said, “NFTs can help fight climate change by mainly changing the incentive systems we have in place. The decentralisation, transparency and ownership provided by web3 can create new ways for people to see money value in preserving and regenerating the environment, at the same time organisation and projects can diversify their support channels and be accountable for the impact they are doing.”
Amaral took the example of tokenising a piece of land where lies barrels of oil.
By not extracting this oil, and leaving the environment intact, carbon credits can be generated that the owners of the token correspond to that land could benefit from, he said.
“This can be applied with species as well, through bio registry bonds. Through geolocation and validation, the projects can be accountable and prove the real impact they are generating,” he added.
Adding to what Amaral said, Noel Saldanha, an NFT enthusiast, said, “Notwithstanding the energy consumed in minting NFTs, an area where many entrepreneurs are working on, they are an increasing number of NFT projects that are raising funds for causes aimed at fighting climate change.”
“Additionally, a rising number of projects are helping preserve endangered forest land, most notable being Moss. Earth, by engaging users with key environmental aspects surrounding them via bespoke NFTs created for the very purpose,” he added.
Aliasgar Merchant, Co-Founder of ‘Learn Web3 With Us’, said, “NFTs can be used in various ways to help combat climate change. For example, in areas where illegal forestation is rising, trees can be assigned tags which are tracked on Blockchain.”
“This can serve 2 purposes: The tree can be tracked and made sure it’s not cut. And using certain microcontrollers, sensors and devices like raspberry pi the health of trees can be monitored. One other way Blockchain can help is by ensuring accountability. At various summits around the world, tall promises are made. Are they actually fulfilled? This can be tracked and recorded through Blockchain and NFTs,” he added.
Summing it up, Arijit Mukherjee, Founder of Yunometa, said that the new Ethereum blockchain on which a majority of NFTs are hosted is moving to a new proof of stake mechanism that promises to cut down carbon emissions in a significant way.
“Apart from this, we’ve also seen NFT collections highlighting alternative energy solutions, carbon neutral NFTs, carbon offsetting etc,” he added.
He further noted that artists have also committed to reducing the carbon footprint of their digital works with “Beeple, the world’s highest-selling NFT artist, stating that he will offset the emissions for all of his future collections.”
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
