“NFT”, stand for “Non-Fungible Token” or “non - interchangeable asset”, NFTs are currently taking the digital art and collectibles world. It is a new digital art trend in the art world that is growing in popularity. NFTs are tokens that we can use to represent ownership of unique items - no one can modify the record of ownership or copy/paste a new NFT into existence.

          NFT’s generally built using the same kind of programming as cryptocurrency, they can be traded or exchanged or conducted transactions to the blockchain on Ethereum that currently uses PoW consensus algorithm. Mining cryptocurrencies is a highly energy intensive process that requires computers to solve complex algorithmic problems in order to add to the blockchain and receive cryptocurrency tokens. NFT has a stunning environmental footprint of over 200 kilograms of carbon dioxide, equivalent to driving 500 miles (804 kilometers) in a typical American gasoline-powered car.

          Although the NFT is still controversial about its environmental impact, especially climate crisis, comes with enormous greenhouse-gas emissions. As more artists became aware of the environmental consequences of blockchain practices, they pressed for platforms to move away from NFT, even if it costs millions of dollars. Joanie Lemercier, a French artist, He had just released 6 Crypto Art works consumed in 10 seconds more electricity than the entire studio over the past 2 years.

          A significant portion of the NFT's energy consumption comes from a consensus algorithm that Ethereum uses to verify transactions that consume lots of energy. Instead of Ethereum, use less energy-consuming blockchains such Polygon, Tezos, Algorand, and other PoS networks. Polygon, Indian platform which is 84810x more energy-efficient than Ethereum. Bubblehouse is also announced itself as the first carbon-neutral NFT marketplace etc.

          However, Ethereum’s new upgrade is going to lower the energy consumption. Furthermore, there are now carbon offsets for NFTs. However, we would have to keep up with NFT technology transformation that is constantly improving itself to be more eco-friendly.

          In Thailand, The Securities and Exchange Commission of Thailand (“SEC”) has recently issued regulations, that will take effect on 1st April 2022, prohibiting all licensed digital asset operators namely, cryptocurrency and digital token exchanges, brokers, dealers, fund managers and advisors, from supporting or facilitating the use of digital assets for the payment for goods or services. To explore the impact of this regulation, there's so much going on that it has to keep track on direction of NFT.

 

Reference

1. https://cryptosiam.com/ethereum-transaction-energy-use/
2. https://today.line.me/th/v2/article/RB0JLxe
3. https://digiconomist.net/ethereum-energy-consumption
4. https://ecommerce-platforms.com/th/articles/the-environmental-impact-of-nfts
5. https://theconversation.com/nfts-why-digital-art-has-such-a-massive-carbon-footprint-158077
6. https://www.varasarnpress.co/writings/lifestyle/nft-environmental-concern/
7. https://news.trueid.net/detail/kvrNaN1WEykv