What are NFTs?
NFT, or Non-Fungible Token, is a unique and non-interchangeable unit of data stored on a digital blockchain. It functions like a unique serial number for an item or event, utilizing blockchain technology to ensure the item's legitimacy. They serve as digital ‘certificates’ that link to the ownership of a one-of-a-kind physical or digital asset such as paintings, real estate, music, or movies. Bitcoin, for example, is fungible — exchange it with another and you'll get the same thing. A one-of-a-kind baseball card, on the other hand, is non-fungible. You'd get something altogether different if you swapped it for a different card. NFTs are similar to that one-of-a-kind baseball card. They are purchased and sold online and are provided as a digital proof of ownership for any specific object.
The Environmental Controversy around NFTs
With the rise of NFTs and cryptocurrency alike, many people are questioning its effects on our environment, especially the blockchain technology that enables it. NFTs and cryptocurrencies require a massive web of electricity-consuming computers to operate their blockchains. This extensive use of electricity leads to more fossil fuel consumption which, in turn, heightens air pollution, climate change, water pollution, etc. To draw a comparison, Bitcoin is a cryptocurrency that also uses blockchains. Its environmental effects have been thoroughly documented. Research done by the University of Cambridge indicates that its network consumes more energy than the whole Netherlands. In contrast, the study of the energy requirements of NFTs is less established. In March 2021, CryptoArt.wtf, a website designed to assess the environmental effect of NFT markets, shut down stating that their site had been used "as a weapon for abuse and harassment." The site's founder, digital artist Memo Akten, estimates that the typical NFT has a carbon footprint equal to that of a person residing in the EU every month. It is uncertain whether those emissions may be directly linked to individual NFTs or the blockchain as a whole.
The Public has Spoken
On November 9, News of “Discord implementing cryptocurrencies” was teased by Jason Citron, the co-founder of Discord on Twitter. In response to a blog article speculating on Discord's future, Citron shared a screenshot of what appears to be a beta version of the software, showcasing compatibility with cryptocurrencies and other blockchain technologies. Users were enraged by this announcement. A Reddit thread, headlined "Discord developers: please do not support NFTs," asks the platform to drop the initiative, calling it "a feature your user base universally hates." The discussion received hundreds of upvotes, with one user branding NFTs as a "Ponzi scam" and another urging Discord Nitro users to "vote with your wallets" and cancel their subscriptions.
On the other side of the globe, BTS' parent company, HYBE, has revealed that it is venturing into NFTs, utilizing blockchain technology to mint photographs of K-pop artists. "HYBE and Dunamu plan to develop an NFT business under a new joint venture, which will allow the artist IP-based content and products that HYBE has showcased to date to become digital assets for fans," Hitman Bang, the chairman-founder of the company, stated in an announcement. BTS Fans were enraged. Many of them turned to Twitter to criticize the company's crypto transition, calling it dishonest and insulting — especially given BTS' history of environmental advocacy.
Sources:
Winter, L. (2021, December 15). What Are NFTs (Non Fungible Tokens), Why People Are Paying Millions For Them? Glamour UK. https://www.glamourmagazine.co.uk/article/non-fungible-token-nfts
Babu, V. (2021, November 9). Explainer: What are NFTs, and why the sudden frenzy about them? The Hindu BusinessLine. https://www.thehindubusinessline.com/money-and-banking/explainer-what-are-nfts-and-why-the-sudden-frenzy-about-them/article37395195.ece
J. (2022, January 7). Debunking EVERYTHING About NFTs — The Controversy, Technology, and How They Affect Artists. Medium. https://jisuartist.medium.com/debunking-everything-about-the-technology-ecological-impact-of-nfts-cryptoart-60ee09bd00ed
Yeo, A. (2021, November 4). BTS’ parent company is making NFTs, and fans are furious. Mashable SEA. https://sea.mashable.com/tech/18138/bts-parent-company-is-making-nfts-and-fans-are-furious
Brown, A. (2021, November 10). Discord community boycotts platform over “disappointing” crypto integration. NME. https://www.nme.com/news/gaming-news/discord-community-boycotts-platform-over-disappointing-crypto-integration-3090970
Published January 19, 2022
Written by Skye Cabrera ~ Edited by Kristeen Patel ~ Graphics created by Samridhi Verma
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