EW Articulos
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EW Articulos

Are NFTs the equivalent of a burning oil tanker?

Too many times lately I hear people talking about non-fungible tokens, mostly people who are not involved in the crypto world at all.

That’s good in principle, isn’t it? Adoption always is, well, masses have a need to identify with a side regardless of whether they understand the issue or not, in this case the internet echoes that NFTs are pollutants, and since no one wants to be on the “evil” side, it is a fact for them that NFTs are horrible and a cancer to the earth, is this true?

Before answering the question, I would like to make clear the profiles that defend this position:

  • People who are ignorant of the subject, but who, as I said, seem to have the white knight syndrome with society.
  • People who know part or all of the crypto world and discuss with tangible arguments their opinion about it.
  • Beautiful people who are totally unaware of the subject but who have been poisoned by so much negative information about these so-called NFTs and blockchain in general.
  • And finally, the people it hurts me the most to see, artists who also draw and sell their content digitally, who talk shit about NFTs simply because they see for some reason that I still don’t understand that their artistic career can be economically diminished by these non-fungible tokens, when it is an incredible opportunity to enhance it, that you may or may not want to take and it is a decision of each one, but that does not give the right to throw shit on it, in my opinion, fear of the unknown and lack of adaptability to a changing environment.
The famous internet cat, Nyan Cat, was auctioned by its creator a few months ago as NFT for a whopping $591,351

A simple explanation of what a NFT and things about crypto you should know before we get into the debate about whether they are harmful or not:

Suppose a blockchain is a country, there are many countries, with different qualities that make them unique, some look very similar, others nothing at all, the same applies to the blockchain.

Within a country live people, let’s say they are the so-called NFTs, and that fiat money (euros, dollars, etc.) are cryptocurrencies.

https://jingdaily.com/non-fungible-tokens-nft-art-world/

Cryptocurrencies, that is, in this example fiat money, is something fungible, this means that you can have 50 euros and I can have another 50 euros, and both will have the same value, when the money is received, from whatever source, it enters into a general exchange and it does not differentiate where it comes from, the euros are the same regardless of their origin.

People, on the other hand, are not fungible, you are not the same person as Nicolas Cage, just like Nicolas Cage is not Michelle Obama, people are different from each other, just like NFTs, think of NFTs as an abstract concept, in the sense that it is anything unique in the world, don’t be stuck in the mindset that NFTs are art, it can be applied to a passport (like the Covid passport they want to make), an ID card, your car keys, real state, etc….

Now that we know all this, how is it that people say that what is so great on the surface is bad for the environment?

To create these NFTs you have to make transactions within a blockchain, the problem is that the blockchain where they are fundamentally created and enjoyed is Ethereum, which to function correctly in a decentralised way uses something called PoW or proof of work.

Don’t be scared, it’s scary, but it’s very easy to understand.

Simply put, we won’t even waste time explaining it, let’s just say it’s a method that is like shooting flies with cannons, and energetically speaking, it consumes a LOT of energy.

This is the only point that people who despise NFTs welcome, and they are absolutely right, PoW is a precarious algorithm, that pollutes, and that in my opinion should only be conceived in Bitcoin exclusively, but even this single point is debatable, as I will explain below:

Annualized Total Ethereum Footprints:

  • 48.81 TWh (Comparable to the power consumption of Iraq)
  • 23.18 Mt CO2 (Comparable to the carbon footprint of Dominican Republic)

Single Ethereum Transaction Footprints:

  • 101.24 kWh (Equivalent to the power consumption of an average U.S. household over 3.42 days)
  • 48.09 kgCO2 (Equivalent to the carbon footprint of 106,584 VISA transactions or 8,015 hours of watching Youtube)

How have these data been estimated?

https://digiconomist.net/ethereum-energy-consumption

  • First, the total mining revenues are calculated and converted to USD.
  • Then it is estimated what part of mining revenues are being spent on electricity costs.
  • Lastly, the resulting number is easily converted to kilowatt-hours by dividing it by the average price per kilowatt-hour.
This way of calculating the data is still chasing flies with cannons, they give us very high pollution values when it is really less, but even if it negatively affects Ethereum or Bitcoin, because it does, not take into account where the energy used comes from, it is still good for us, because even with that it does not support what is going to be discussed below.

Shocked by the data, right? Well, here’s my opinion, in these data, although they are “incredible” at an informative level, there is already an important bias.

1 transaction equals 107K transactions of VISA, well, Visa is a digital payments company, along with many other companies and payment methods, ladies and gentlemen, Ethereum is used worldwide by everyone in the world without the need for third parties i.e. banks, or the government itself, and it allows both transactions and programming of immutable applications and algorithms, total governance of your money.

I say this because it is comparing Albert Einstein with a physics student in school, let’s compare it with the current banking system, and to be generous let’s add up the amount of emissions issued by both bitcoin and ethereum, and see what happens:

100TWh/yr of Bitcoin + 100TWh/Yr of Eth = 200TWh/yr….. against between 250–500TWh/yr, It seems that the global monetary system is in trouble even in its most favourable scenario, as I recall, ethereum and bitcoin data are disproportionate.

Bitcoin itself can act as a monetary system, as a reserve of value equivalent or superior to gold, I will not enter into debates on this because it gives a lot to talk about, let’s leave it at that they are similar, in this case Bitcoin dethrones the demagogy of pollution but we are with Ethereum, and with the NFTs.

With all that I have said you are still right and you are right that NFTs pollute and are bad for the environment, well….

Just don’t use Ethereum, slavery used to be something normalised in society, something that today is not, it is no longer seen as ethical, the same is presented here.

Ethereum is in a state of transition from proof of work to proof of stake, which will bring it down to the order of megawatts, but in the meantime there is a transition from slavery to the free man, and to take up the analogies, there are more countries in the world (Blockchains)!

I have waited a long time to start doing this entry, because I wanted tangible data, and to be honest at the time I wanted to do this, there were no other feasible options documented to date, so I did it myself:

Energy Web Chain

I have created although it is not the first NFT on this blockchain, of the first ones, there is zero information about this currently, but it follows the same programming language as Ethereum, and as an irascible programmer, I managed to create it on this network:

What’s so special about this blockchain? It is a PoA network, so as not to complicate your existence more than I am, I will tell you that it is the equivalent of what Eth wants to implement, but with the added bonus that the maintenance of this network is done with 100% renewable energy by inquisition, therefore.

NFTs 100% green and environmentally friendly, boom 🤯

Secret Network

It is the equivalent of Eth, but with proof of stake, which is what eth wants to become, and with the added bonus that no one can know what you do on the network. This blockchain has NFTs, which to date I have not been able to recreate because the programming language is Wasm, and I have not yet mastered it, but it is demonstrable that they exist, and can be created, and although it is a network that is not 100% ecological like Energy Web Chain, it uses PoS, so we are going to the energy order of megawatts.

And as a young up-and-comer we have Sora Network which will soon host a project called Unique One in which they will develop the NFTs, and Sora being a proof of stake network, you know the rest.

I’ll say goodbye but not before I take a look at the artists who say that NFTs pollute:

Contact: franciscopuga@protonmail.com

You can find me on almost any media as @pugafran

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