Every time the world turns, energy burns – or so it seems. The same can surprisingly be said about cryptocurrencies and the carbon footprint they leave behind.
As humans, it is unsafe and unfair to make sweeping generalizations. But, as a universe, it is safe to say that our energy consumption and emissions are not trending in the renewable direction.
NFTs and crypto’s carbon footprint are no different. They are exponentially driving the surge toward the extinction of energetic life as we know it.
Now, that last statement might have been a slight exaggeration. Either way, it is a clear-cut fact that cryptocurrencies and blockchains have been running rampant within the past year.
There are sustainable blockchains. But those typically see less volume as most cryptocurrencies operate on a designed proof-of-work basis.
Foundational crypto models work, but also leave behind a brolic carbon footprint
Proof-of-work is the consensus algorithm within the majority of usable decentralized blockchain networks. Proof-of-work systems secure funds within the decentralized ledger instead of third-party overseers.
They are designed to be inefficient – that way it is less profitable for someone who might have an intention to hack into the blockchain.
The proof-of-stake model is a centralized ledger utilized by NBA Top Shot. In that realm, NBA Top Shot operates on the Flow blockchain which asks that users contribute their tokens. Thus, these token submissions prove the users’ stake in keeping the ledger accurate.
Normally, purchases that occur on the proof-of-work blockchain send economic signals to cryptocurrency miners which in turn increases emissions.
On the bright side, the proof-of-stake model eliminates the need for computers to solve complex puzzles and burn boatloads of energy in the process. Conversely, it creates a single institution oversight which is the exact opposite of why crypto was created.
Who are the major influencers behind cryptocurrencies?
Jack Dorsey – the CEO of Twitter has kept his name in the headlines for all the right reasons.
He was one of the first to step up to the plate and censor the 45th President on his major platform. He purchased Tidal from Jay-Z. And more recently, he sold his first tweet as an NFT. This man has been ahead of the curve for years and continues to influence and inspire those with tech aspirations.
Justin Sun – this economist created his cryptocurrency TRON and has been moving like an absolute boss within the digital space.
His recent acquisition of BitTorrent propagates further decentralization of the internet. Sun’s 9-9-6 model (9 AM – 9 PM 6 days/week) makes him a one-of-a-kind entrepreneur. Keep tabs on him as his cleverness, focus, and work ethic are downright unmatchable.
Michael ‘Beeple’ Winkelmann – as a major player in the NFT space, Beeple has minted his artwork for upwards of millions. He has been spreading his wealth of influence amidst many top platforms. Going forward, he plans to make all of his paintings carbon neutral or carbon negative and encourages others to do the same.
Tim Kang – an original NFT guy – people were questioning his sanity upon his first Beeple purchase. Kang spent $777K on the piece and has spent roughly $1M on 200 digital artworks to date.
He influences the masses by taking risks, creating trends and breaking ground on new developments. Tim Kang was the person that showed other people a world of infinite access to creative liberation through NFT ownership.
What are some ways crypto and its carbon footprint can be sustainable?
Sidechains build another layer on top of an existing blockchain which saves energy via off-chain transactions. Make all of your 1to1 processes exist on a sidechain that avoids energy consumption on the main blockchain.
Bridging creates compatible interoperability between blockchains. Once again, creating a diversion of the crypto trail means that these parallel networks consume energy elsewhere. Thus, the main blockchain player does not get weighed down as the activity takes place off-site.
Lastly, the most important solution we can put forth is purchasing alternatives. These cryptocurrencies are much better for our carbon footprint as all of them are either C neutral or C negative: Algorand, Tezos, Polkadot, Hedera, Hashgraph.
Regardless, for those seeking their foray into the cryptocurrency sphere. Do so at your own financial and environmental risk.
Financially, crypto is extremely volatile and can climb/descend the charts quickly due to its relatively small market cap. Crypto is so volatile that its carbon footprint will always be a topic of conversation.
Environmentally, it is a decentralized energy-hungry beast centered around financial gain.