I started writing this article the Friday before the UN’s Intergovernmental Panel on Climate Change (IPCC) issued their report updating previous projections about the speed and impact of climate change. Returning to the office on Monday and reading the dire news fuels my desire to express my personal opinion about NFTs (which stands for non-fungible tokens), even though I fear many will disagree with me. As summarized by environment correspondent Fiona Harvey in the Guardian newspaper, the UN’s IPCC report states:
“Human activity is changing the Earth’s climate in ways ‘unprecedented’ in thousands or hundreds of thousands of years, with some of the changes now inevitable and ‘irreversible’, climate scientists have warned.
Within the next two decades, temperatures are likely to rise by more than 1.5C above pre-industrial levels, breaching the ambition of the 2015 Paris climate agreement, and bringing widespread devastation and extreme weather.
Based on this scientific reality, I cannot in good conscience support the continued growth and development of the latest art world trend of NFTs in their current format, which generate very high levels of carbon and increase greenhouse gases.
I want to take a moment here to contextualize for readers so they can understand where my perspective is rooted. While I am an art appraiser, I do not consider myself an expert in NFTs. For connoisseurship questions I defer to my good friend and fellow appraiser Claudia Hess, AAA of Hess Art Advisory, who is based in the heart of movement in the Silicon Valley. Claudia has a wide variety of expert interviews and articles I’ve linked below as resources about what NFTs are and how they work:
Claudia Hess’ Interview about NFTs, Art, and Artists with Betsy Streeter for the Jennifer Perlmutter Gallery – I highly recommend watching this for an expert assessment of the longer history of NFT technologies and a detailed explanation of how NFT technology currently works and why it currently uses so much energy, proof of work versus proof of stake, and concerns about energy usage (I love Betsy Streeter’s comment “Earth is non-fungible”). This specialist panel cover many of the topics I’ve introduced here with much greater depth and expertise. If you only watch one thing related to educating yourself about NFTs, I hope it’s this terrific and nuanced interview. https://www.instagram.com/tv/COdSaZGnvx5/?utm_source=ig_web_copy_link
Claudia Hess’ Interview about NFTs on Larissa Wild’s The Art Elevator Podcast: https://www.larissawild.com/blog/the-art-elevator-episode-7-claudia-hess-on-nfts-in-art-explanation
Claudia also brought an excellent article to my attention written by Gillian Tett and published in the Financial Times in August 2021: “Still grappling with crypto basics? You’re not alone” https://www.ft.com/content/cf89a64d-32fe-48ca-85f3-5b36ce4fb6fe
I also want to note that the use of NFTs are not specific to the art industry. NFTs have been attached to a wide variety of objects such as baseball cards, and blockchain technologies and cryptocurrency payments have been in existence in other fields for many years. I am not blaming the art world for adopting NFTs, claiming this is uniquely an art world issue (because in truth many other sectors have been generating large carbon footprints with blockchain technologies for a long time), or saying that NFTs are entirely without merit (the resale royalties to artists are a major improvement from traditional art sales). I’m speaking to this from an art world perspective because A) I am part of the art world, B) the arrival of NFTs in the art world is relatively new, C) I feel that we in the art world collectively have an opportunity now to express our wishes for how we want to interact with this technology and what we expect of the providers of this technology in terms of their environmental responsibility.
My chief misgiving is that the inefficiency of the current technological process consumes huge amounts of energy, and innovations that could dramatically reduce energy consumption have not yet been implemented on a widespread scale. Before the art world fully commits to an expanding NFT marketplace, we should hold the NFT service providers accountable for making these achievable changes to reduce NFT carbon footprints.
My opinion is based on my personal identity as an environmentalist (we all can agree that it would be good to still have a planet to live on, right?) and how I’ve witnessed many in the art world enthusiastically jump on the NFT bandwagon following the 69 million dollar sale of a Beeple NFT at Christie’s this spring. As Claudia pointed out in her interview on Larissa Wild’s The Art Elevator Podcast, NFTs have a very high carbon footprint, exponentially higher than most artworks made in traditional mediums like paintings and sculpture. The continued expansion of NFTs in the art world will pour more greenhouse gases into the atmosphere at the very moment when our own continued survival as humans, and also that of our more-than-human neighbors on this planet, depends on reducing them. Is this the legacy we want to create?
Is there money to potentially be made (and lost) in NFTs? Absolutely. I’m not speaking to their economic viability in this article, but instead to their moral irresponsibility.
For those readers squirming and thinking I’m overreacting about the devastating environmental impact of NFTs, I direct you to Gregory Barber’s excellent article “NFTs are Hot. So Is Their Effect on the Earth’s Climate” published in Wired Magazine in March 2021 (https://www.wired.com/story/nfts-hot-effect-earth-climate/). Barber writes:
“Two years ago, Joanie Lemercier, a French artist known for his perception-bending light sculptures, took on a new role as a climate activist. He attended protests against coal mining, projecting lasers onto excavators and government offices with dramatic effect, and began a campaign demanding Autodesk stop selling its design software to fossil fuel operations. He also took a closer look at his own energy use, which included a hefty heating bill for his studio in Brussels, electricity for the high-end computers to render his creations, and dozens of flights each year to exhibitions around the world. He tracked it all down to the watt and vowed to reduce his energy use by 10 percent each year, a goal he had successfully met. Then, a few months ago, in the course of a few minutes, his progress was erased.
The culprit was Lemercier’s first blockchain “drop.” The event involved the sale of six so-called nonfungible tokens, or NFTs, which took the form of short videos inspired by the concept of platonic solids. In the clips, dark metallic polyhedrons rotate on loop and glisten—a reference to Lemercier’s installations in the physical world. The works were placed for auction on a website called Nifty Gateway, where they sold out in 10 seconds for thousands of dollars. The sale also consumed 8.7 megawatt-hours of energy, as he later learned from a website called Cryptoart.WTF.
That figure was equivalent to two years of energy use in Lemercier’s studio. Since then, the art has been resold, requiring another year’s worth of energy. The tally was still climbing. The problem, as Lemercier saw it, went well beyond himself. His fellow artists were becoming millionaires overnight as the cryptoart world exploded. But so was their role in emitting carbon. Artists didn’t seem to understand the scope of this problem—Lemercier himself hadn’t—and the platforms making the sales didn’t seem interested in clarifying.” [emphasis added] (https://www.wired.com/story/nfts-hot-effect-earth-climate/)
In May 2021, Sophie Lewis wrote an article for CBS News titled “NFTs may be the future of art—but are they threatening the future of the planet?” with jaw-dropping comparisons of the energy use of NFTs and the technologies they run on as equivalent to the energy use of entire global nations:
“The growing awareness of NFTs' environmental impact comes as evidence piles up about the harmful toll of crypto technology.
Annually, Ethereum is currently estimated to consume roughly 44.94 terawatt-hours of electrical energy, which is comparable to the yearly power consumption of countries like Qatar and Hungary. It is responsible for about 21.35 metric tons of carbon dioxide released each year, comparable to the carbon footprint of Sudan.
The amount of electricity that mining Bitcoin consumes in one year is equal to that used to power Malaysia, Sweden or Ukraine, according to the Cambridge Bitcoin Electricity Consumption Index. In a recent study, scientists warned Bitcoin alone could push the Earth's temperature 2 degrees Celsius above historical levels, if it were to become as widely adopted as other new technologies.” [emphasis added] (https://www.cbsnews.com/news/nft-art-environmental-costs/)
In response to backlash following the publication of these articles, and many others in the spring of 2021 documenting the dramatic environmental damage NFTs will cause, some NFT companies have pledged to become carbon neutral by offsetting their carbon emissions through the purchase of carbon offsets. But that does not mean they’ve stopped generating and emitting huge amounts of carbon—they still are. It only means the companies are giving money to organizations that promise to “offset” the carbon they just emitted through an activity that sequesters carbon like planting trees.
This is not a sustainable path forward, especially in light of the heartbreaking data included in the IPCC report. As a planet, we cannot afford to plunge headlong into a new art trend that releases huge amounts of greenhouse gases into the atmosphere. Promising to offset all we’ve released by spending money to sequester an equal amount of carbon to repair the damage we’ve created is irresponsible and dangerous when the world has such a thin margin left to avoid catastrophic changes. There are also many analyses that demonstrate carbon offsetting is a highly imperfect technique at best and can sometimes do more harm (see Lisa Song’s article in ProPublica for a detailed analysis: https://features.propublica.org/brazil-carbon-offsets/inconvenient-truth-carbon-credits-dont-work-deforestation-redd-acre-cambodia/)
There are two issues frequently touted as benefits of NFTs that I do think hold merit and I challenge our field to find alternative solutions that don’t spew carbon into the atmosphere. The first is that the current structure of the art market is very challenging for the artists who actually create the work, and most of the profits are funneled to dealers, collectors, auction houses and other art world players who own the art after creation. In the United States (this is different in some European countries), the artist never benefits financially from subsequent sales of her or his artwork. NFTs have been praised for offering more options for artists to receive resale royalties on future sales. This is a topic Claudia Hess, Betsy Streeter, and Jennifer Perlmutter discuss in detail in their joint interview referenced earlier and I encourage readers to listen to their insights and exploration of alternatives to paying artists fairly outside of an NFT context.
I think this is a valid point and I would support artists receiving resale royalties from future sales of their art. This could be accomplished legislatively, through a vehicle similar to the Visual Artist Rights Act (VARA) passed in the United States in 1990. Conferring these protections and resale royalties to artists can be achieved without any carbon footprint if it is done through legislation, rather than leaving artists vulnerable to the contracts they enter into to mint an NFT that releases greenhouse gases. It can be very expensive for an artist to mint an NFT, so a legislative solution would be a fair and accessible expansion of rights for all artists independent of their financial means. This would also allow artists who work in non-digital mediums to receive resale royalties rather than just artists whose work involved NFTs.
The second issue is determining authenticity and tracking provenance through the use of blockchain technology. Determining authenticity and provenance is a huge challenge in the traditional art world, which can allow fakes and forgeries to circulate undetected. Blockchain has revolutionized art authentication capabilities, but it runs on the same carbon-intensive technology. Could this be redesigned to reduce the damaging environmental impact? Some experts think the technologies behind blockchain and NFTs could redesigned to significantly decrease the carbon footprint. A number of promising possibilities already exist that could dramatically reduce energy usage, but they have not yet been implemented across the field. The international legal firm Osborne Clark wrote a detailed analysis of energy use and options for blockchain technology outlining alternative scenarios: https://www.osborneclarke.com/insights/not-blockchain-heavy-carbon-footprint/
Given all these significant failings, both to the planet and as a functional art commodity, why is the art world continuing our love affair with NFTs in their current format? Is the lure of a potential profit stronger than our moral compass? As an art world professional, and a person who loves my planet, I don’t feel I can responsibly support the expansion of the NFT market until the technologies that underpin it are altered so they no longer release massive amounts of greenhouse gases into a critically fragile atmosphere.
Members of the arts community have always been the ones who created beauty in our world. Why do we now want to be the ones leading the way to destroy it? I respectfully call on my art world colleagues to reflect on the siren call of NFTs and ask themselves if its current carbon footprint is aligned with the values we want to embody.
