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The Environmental Impact of NFTs and Its Future

NFTs and its environmental impact header

NFT enthusiasts are always on the hunt for the latest and rarest NFT collection there is. Whatever the reason, owning an NFT is certainly a prized possession giving its collector or owner the feeling of being part of an elite club. Then, there are eco-warriors or environmentalists that keep on questioning its environmental impacts.

Their argument is consistent — the blockchain space consumes heavy loads of electricity coming from nonrenewable resources like fossil fuels, which means the more electricity consumed, the greater the carbon footprint it leaves on the atmosphere. Fair enough, their arguments are starting to make sense as the world continues to witness the devastating effects of climate change — melting ice caps, rising sea level, more drought.

Now, blockchain giants such as Ethereum and Bitcoin are now finding the best alternative to help battle climate change, without compromising their respective platforms. But before we dig into how they will do such move, let’s first discuss how NFTs have greatly contributed to the atmosphere’s carbon footprint.

What Are NFTs and How Do They Work?

NFTs or non-fungible tokens — which can come in metaverse real estate, music, artwork, drawings, or even selfies — are new avenues for artists to earn money from their artwork and buyers to support their favorite creators. In addition, it also gives the buyers the bragging rights of owning exclusive content.

NFTs use blockchain platforms to certify a person’s ownership of an asset. It also holds specific pieces of information that make them work differently from cryptocurrencies. Most of the NFTs today use the Ethereum platform to buy, sell, and transfer ownership. If you buy an NFT on the Ethereum platform, you send Ether to the marketplace handling the transaction or to the current owner. In return, you get the NFT in your wallet.

One aspect of this payment method is the “gas fee” or the service charge associated with the entire transaction, and these go to the owners of the network of computers used to handle the transactions on the blockchain. Owning an NFT is similar to owning the rights to a collectible piece of art, and owning the rights is more like owning the original painting of an artist.

So, How Much Energy Do NFTs Consume?

On average, minting an NFT on the Ethereum blockchain alone consumes more than 260 kilowatt-hours of electricity — the same amount an average household in the US consumes for about 9 days.

However, that will all change once Ethereum switches from “proof-of-work” to “proof-of-stake” as the overall energy consumption is predicted to go down to 99.95%, or nearly the equivalent of just watching your favorite TV show for 20 minutes.

Why NFTs Consume So Much Energy?

NFTs themselves don’t harm the environment, but how they are minted, sold, bought, and transferred drastically affects the planet. Here’s an overview of how NFTs work under the “proof-of-work” system to understand how their production consumes so much energy.

  1. NFT is listed in a digital marketplace: Before you can mint an NFT, it’s listed in a digital marketplace. It might not consume too much energy, but the location of the NFT listing will determine how much energy the mining process will require. Deciding on the NFT marketplace like OpenSea, which hosts the Ethereum platform that uses the proof-of-work system, means that the mining process will consume more electricity.
  2. NFT is purchased: Buying an NFT signifies that the NFT is minted. Using the proof-of-work system, the NFT is mined or minted by cryptocurrency miners who control extensive computing resources. Mining an NFT consumes too much energy due to specialized computing hardware that also consumes a huge amount of electricity. Miners race to quickly solve complex math problems, earning the right to mine the NFT.
  3. NFT is transferred or stored: You can store the NFT or transfer it to another person upon completing the purchase. If you transfer it to another marketplace that uses the proof-of-work system, then the same energy-intensive process used to mint the NFT is repeated for the transfer. On the other hand, simply storing an NFT doesn’t consume energy.

Only miners with the most computing power are likely to solve complex math problems the fastest, meaning they need to use a huge amount of computing hardware and consume a lot of electricity.

Today, a network of miners is competing to validate blocks of transactions, including NFT transactions; therefore, it’ll require them to consume more electricity. That’s still the case, even if only one miner is chosen to validate each new block of transactions.

How Can NFTs Lower Energy Consumption?

Blockchains like Bitcoin and Ethereum use the “proof-of-work” system, which is one of the reasons for their high energy consumption. One alternative is to use a blockchain running a different system — the “proof-of-stake” or PoS setup.

PoS blockchains like Polygon, Symbol, or Tezos don’t rely on massive computing power; therefore consume much less electricity. For example, Tezos has an estimated annual energy consumption of 0.00006Twh, compared to 33.57Twh for Ethereum.

Today, Ethereum is slowly adapting to the PoS system, and its website is calling for new stakers, who will be responsible for securing that network and handling transactions.

Others claim that PoW blockchains will be acceptable if they use renewable energy.

Based on a Cambridge University study, 39% of all PoW systems now run on renewable energy, which is expected to increase in the future. Despite this, some critics still claim that the consumption of renewable energy, which is a limited resource, is still harmful to the environment.

Furthermore, PoW depends on the financial cost of computing instead of the amount of energy consumed, so renewables might help lower energy consumption and cost, only for miners to spend more as Ethereum rises.

Tips for NFTs to Use Less Energy

Transferring or mining an NFT consumes too much energy, but it doesn’t have to be.

Blockchain platforms using the PoS system can generate exclusive NFTs without using too much electricity and harming the environment. For most, the PoS system consumes less energy than the PoW setup because the former doesn’t require the extensive use of computing hardware.

On the other hand, miners using the PoW system will only consume more electricity to mine a block successfully. Validators are also encouraged to stake — agree not to sell or trade their cryptocurrency holdings.

Blockchain validators need to implement a staking requirement to secure a blockchain without asking the network’s participants to consume too much energy excessively.

NFTs can be less harmful to the environment by:

Using renewable energy: Miners using the PoW system to secure NFTs can use renewable energy sources. PoW mining can be energy-intensive, but the energy source needed to mine can be free of emissions. Solar power is a popular choice for many, but other alternatives can be hydro and wind-generated electricity.

Investing in renewable energy: With NFTs gaining more popularity and selling for amazing prices, you can allocate a small portion of these proceeds to investing in renewable energy sources. Shifting to renewable energy can lessen, and hopefully eliminate, the environmental impact of producing NFTs.

Investing in experimental innovations: You can also invest your NFT sales proceeds in experimental innovations designed to reverse or mitigate the effects of climate change. Carbon storage and capture, which collects and pumps carbon dioxide emissions into the ground, is a great example of an experimental innovation you can use to minimize climate change.

Buying carbon offset credits: Buyers who want to offset the environmental impact of an NFT purchase can buy carbon offset credits. While purchasing these credits doesn’t reduce carbon dioxide emissions, it offers a financial incentive, encouraging other buyers to minimize their total emissions annually.

The Future of NFTs

Electricity consumption isn’t the only contributing factor to NFT’s environmental and carbon footprint, regardless of the type of blockchain. More computer hardware is also used as the number of cryptocurrency stakers and miners increases, so the total carbon footprint of NFTs is expected to soar high.

The environmental issues caused by NFTs cannot be solved overnight as there are still plenty of platforms using energy-extensive methods. But one thing is certain, there is now a vision of a future where blockchain technology is integrated in almost anything that we see on the internet, without causing harm to the environment at all! That’s really a promising future!



NFTing is the all-in-one NFT ecosystem with multi-chain functionality, multilingual features and an intuitive interface that is easy to use by artists, collectors and crypto newbies alike.

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