What do NFTs Mean for the Future of Sustainability in Fashion?
Why virtual fashion isn’t the antidote to physical fashion
Virtual clothing and Non-Fungible Tokens or NFTs are redefining the scope of the fashion industry, and presenting a new layer to pre-existing sustainability issues. We typically attribute the ecological degradation caused by fashion to the physical nature of clothes. The pollution produced by textile factories creates a massive carbon footprint and causes harm to factory workers and locals. Additionally, toxic chemicals from dyes leaking into water sources can ruin drinking water supplies, often turning rivers in sourcing countries like Bangladesh shades of pink, blue or black as a result. And at the end of a garments lifecycle, the impact continues, as billions of pounds of clothing pile up in landfills, many of which take up massive amounts of space in developing countries such as Ghana and India, the latter of which may need a landfill the size of Delhi by 2050 to accommodate.
In this respect, it may seem counter-intuitive to see virtual fashion as contributing negatively to climate change. Although it’s not material and eliminates many conventionally destructive processes, the energy consumption that allows for virtual fashion pieces to be sold as NFTs is shockingly high and incredibly damaging.
For many of us, the concept of NFTs is relatively new, and if you struggle to define exactly what they are, you’re not alone. Put simply, an NFT certifies the authenticity of a digitized item. For example, a digital piece of artwork becomes an authenticated digital asset through a computing process of ‘mining’ or ‘minting’ into an NFT. This technique assigns the digital artwork value, and embeds it into a blockchain network, which is an online ledger that records cryptocurrency transactions. Blockchain basically takes the place of an institutionalized bank, as it’s responsible for recording the transactions of virtual currency and storing the NFTs. While other copies of a digital piece of art or fashion may exist, only one will have this NFT certificate of authenticity embedded in the blockchain with ownership rights.
Beyond capitalizing on the trend of virtual fashion, the nature of NFTs offer a solution to copyright and intellectual property issues that designers have been confronting. Since NFTs act as tokens of authenticity by assigning ownership to the designer, the creation is protected from being replicated by stamping its time and date of creation, as well as number in circulation. Additionally, designers can benefit from second-hand sales income, as royalties can be programmed into the lifespan of the NFT. This means whenever it’s sold again, the designer will receive their share of the sale, the percentage of which can be embedded into the blockchain, like a virtual contract.
What was formerly a wild concept is now the latest trend in the creative industries. And in true avant-garde form, fashion is following suit. While the rise of virtual fashion may seem like a stretch today, it will likely become normalized and accepted. Luxury fashion house Dolce & Gabbana first experimented with NFTs to incredible success in September 2021, auctioning off multiple creations, including a virtual tiara which sold for over $300,000 and a virtual suit for over $1 million. These pieces came with added physical benefits for the buyers, granting them access to Dolce & Gabbana fashion shows for a year and private tours of their workshop in Milan. Another approach was taken by Burberry, who used the gaming sphere to enter the NFT world, by partnering with Mythical Games to create NFTs for multiplayer game Blanks Block Party, where the brand designed a limited number of monogrammed accessories like jet packs and shoes for players to purchase for their characters to wear. On the other end of the spectrum, the rise of virtually native fashion houses like RTFKT and The Fabricant are targeting another range of consumers who are mainly interested in dawning digital clothes on their meta-versal avatar, or for an Instagram post. Essentially, fashion is already targeting the NFT buyer space from multiple angles, and figuring itself out in the process.
It’s clear that there are business incentives for designers to produce virtual fashion, and the major consideration that designers and consumers need to take into account is the energy impact of blockchain technology. The computing power that blockchain requires is massive. To put it into perspective, currently there roughly 400,000 bitcoin transactions daily, and calculations have shown that one transaction of the cryptocurrency bitcoin equals the power consumption of a U.S. household over 62 days.
There are other consensus mechanisms which that allow for NFTs without consuming so much energy. While the process of each is complex, the amount of energy consumption comes down to how cryptocurrency coins are ‘mined’, which is the computing process of verifying the transactions and storing them into the blockchain ledger. Currently the ‘proof of work’ mechanism is widely used in blockchain to mine new tokens and validate transactions. This is the most energy intensive option. The second leading option is ‘proof of stake’ which is more energy efficient as it doesn’t require the high-powered computing that ‘proof of work’ does. However, it’s a more complicated and less secure system. Other alternatives include ‘proof of burn’ which burns virtual currency tokens during mining, and ‘proof of weight’ which gives crypto holders a weight dependent on how much currency their hold. Understanding the difference between all of these is unlikely a high priority for most consumers. If a brand is truly committed to sustainability and decides to produce NFTs, then researching which consensus mechanism is least environmentally impactful will be essential to their reputation.
While many brands are implementing environmental strategies to reduce their carbon footprint, if they choose to produce NFTs, further sustainability measures will need to be put in place. Until technology can allow for less energy intensive blockchain computing, designers will need to figure out how to minimize their environmental footprint. This might mean designing a sustainability strategy which cuts back on other polluting areas within physical production to account for the impact of NFTs. Brands could also publicly acknowledge the environmental impact of NFTs, and advocate for advances and alternatives in blockchain technology so that we can push for a more energy efficient space.
As fashion begins to establish itself digitally, new possibilities are developing which have the potential to expand and redefine fashion as we know it. However, in order to sustain this movement, thorough environmental consideration, strategy, and regulation will have to come in at the same time. For cryptocurrency, environmental regulations will likely have to come from a policy level, and some solutions have been discussed already, including placing carbon taxes on the machine producers or banning mining operations from using the electric grid.
Direct improvement to cryptocurrency computing will allow for fashion to operate in the NFT space on a greener scale. From there, designers can more accurately account for the carbon impact of NFTs in relation to the impact of their physical garments and make measured sustainability decisions. The future of fashion in this space will likely be shaped by the scope of societal adaptation of virtual reality, along with developments in sustainability within blockchain. Along these lines, fashion will design its virtual form.
