Non-fungible tokens (NFTs) and ordinals are assets that are tokenized using a blockchain. Because blockchains use ener♐gy, NFTs can c꧒ontribute to greenhouse gas emissions and climate change through their production, exchange, and storage.

Learn more about NFTs and ordinals, their environmental impacts, and 🌜steps users can take to be more aware.

How NFTs Impact the Environment

NFTs are generally built on Ethereum or blockchains similar to it. Ordinals are similar to N♛FTs but created on the Bitcoin blockch🌞ain or blockchains like it.

Depending on the programming and design of the blockchain on which these NFTs and ordinals reside, these transactions can consume significant amounts of energy.

Energy consumption occurs when an NFT is minted, bought, sold, and stored. Here's a look ♌at each of these stag♈es of the NFT lifecycle:

• NFT is minted: The NFT creator uploads an image or other digital asset to a blockchain (including its metadata), which tokenizes and stores the NFT's information on the blockchain. 澳洲幸运5开奖号码历史查询:Tokenization is the process of generating a 澳洲幸运5开奖号码历史查询:public key and a 澳洲幸运5开奖号码历史查询:private key to access a 澳洲幸运5开奖号码历史查询:cryptocurrency wallet. The NFT is minted through this process.
• NFT is listed: Once the NFT is minted on a blockchain, the creator can list it for viewing on an NFT marketplace at a set or auction price.
• NFT is sold/purchased: When the NFT is purchased, a blockchain transaction is initiated. The blockchain network goes to work validating the transaction and transferring ownership of the NFT to the new owner.
• Storage: The asset—a file, image, and so on—is stored off-chain, such as on the interplanetary file system (IPFS).

Non-Transactional Energy Use

NFTs also require storage, even if there isn't transaction activity. These tokenized assets are generally digital assets such as documents, images, and videos, all requiring digital space. Blockchains themselves are not equipped to store these assets, so only the tokens (alphanumeric sequences that are the result of hashed data) are stored on the blockchains. The assets are stored elsewhere, such as on the interplanetary file system (IPFS). The IPFS was created as a decentralized and distributed storage system for platforms that need it, like blockchains.

Data storage requires energy. As the number of NFTs grows, the overall energy con♎sumption and storage space of NFT🍎s are likely to increase.

Electronic Waste

In addition to energy consumption, electronic waste (e-waste) is an issue. If a blockchain relies on mining, li🙈ke Bitcoin does, hardware is continuously improved and upgraded.🅘

Mining typically uses hardware such as 澳洲幸运5开奖号码历史查询:central processing units (CPUs), 澳洲幸运5开奖号码历史查询:graphics processing units (GPUs), and 澳洲幸运5开奖号码历史查询:application-specifi🌟c integrated🍸 circuits (ASICs) to solve increasingly ♍difficult cryptographic problems. This hardware ꦬcan quickly become outdated—it's also subject to 24-hour 100% usage, which wears electronic circuits out. Updating and replacing faulty equipment creates tons of e-waste.

E-waste contains hazardous materials, such as lead, mercury, and cadmium, which can leach into the environment if improperly disposed of. Additionally, the processing of e-waste is energy-intensive and can contribute to 澳洲幸运5开奖号码历史查询:greenhouse gas emissions. Hardware that isn't rꦡecycled ends up in landfills, releasing toxins into the environment.

Improving the Sustainability of NFTs

Given the potential environmental impact of NFTs, there is a movement to develop more sustainable blockchain and NFT protocols. Additionally, artists, buyers, and sel🌊lers can choose to use NFT platforms and blockchains that use less energy. These would likely include less energy-intensive consensus mechanisms and, to a point, blockchains with hotspots in areas that use renewable energy sources.

To determine blockchain sustainability, you must inspect where nodes are located and determine the significant energy sources in those areas. For example, the Ethereum network has 2,900 nodes (the most) in the U.S., the energy generation of which is 79% from petroleum, natural gas, and coal. The U.S. also has about 1,600 reachable Bitcoin nodes. It's safe to say that platforms using a blockchain with a significant presence in the U.S. are not as energy efficient as they could be. However, Ethereum uses less energy, so in the U.S. it's a better choice.

Renewable Energy

Blockchain mining and hardware recycling often rely on burning fossil fuels, leaving a significant environmental footprint. 澳洲幸运5开奖号码历史查询:Renewable energy sources, such as solar energy, wind energy, hydroelectric energy, 💎geother🦹mal energy, and biomass energy, offer eco-friendly alternatives to power these operations.

• Solar Energy: Solar panels are installed to capture 澳洲幸运5开奖号码历史查询:energy from sunlight, which is then converted into electricity.
• Wind Energy: Wind turbines erected in windy areas can generate electricity from the kinetic 澳洲幸运5开奖号码历史查询:energy of the wind.
• Hydroelectric Energy: 澳洲幸运5开奖号码历史查询:Hydroelectric power is taken from water sources, such as rivers or dams.
• Geothermal Energy: Geothermal power comes from active geothermal resources, such as volcanoes or hot springs. 
• Biomass Energy: Biomass energy consists of organic materials. Plants, crops, and agricultural waste can be burned to generate heat or converted into biofuels.

Consensus Mechanisms

Shifting from 澳洲幸运5开奖号码历史查询:Proof-of-Work (PoW), the 澳洲幸运5开奖号码历史查询:consensus mechanism for Bitcoin and 澳洲幸运5开奖号码历史查询:other mining-based blockchains, to more energy-efficient ones, such as Ethereum's 澳洲幸运5开奖号码历史查询:Proof-of-Stake (PoS) model, can significantly reduce the environmental💃 impact NFTs have. PoS eliminates the competitive mining and reward pr𝔉ocess altogether.

PoS consumes significantly 澳洲幸运5开奖号码历史查询:less energy than PoW because PoS does not require miners to expend energy in a competition to solve a cryptographic problem. Instead, PoS uses a system called staking, where validators who have staked cryptocurrency—basically locking it from being used—on the network are randomly chosen to verify transactions and propose new blocks💛.

Ethereum is expected to consume about 5.36 gigawatt hours of electricity annually, while Bitcoin is expected to consume about 173.19 terawatt hours annually, more than Poland and Egypt.

Some notable PoS blockchains include:

• Ethereum: The Ethereum blockchain is used for almost everything from simple token exchanges to NFTs, 澳洲幸运5开奖号码历史查询:smart contracts, 澳洲幸运5开奖号码历史查询:decentralized apps (dApps), and more. The NFT marketplace OpenSea is built on Ethereum.
• Solana: The Solana blockchain supports a broad range of NFT marketplaces, including Magic Eden, Solanart, and Rabbit Hole.
• Algorand: The Algorand blockchain supports Aorist, an NFT blockchain, and several other NFT marketplaces.
• Cardano: Hosts some NFT marketplaces like Galaxy of Art.
• Tezos: The Tezos blockchain hosts several NFT marketplaces, such as Rarible, which operates an NFT marketplace and supports the artistic creation of NFTs.

The Bottom Line

NFTs leave a carbon footprint at every꧑ stage of their existence✃, but conscious choices and prioritizing eco-friendly practices in how they are created, traded, and stored can offset their potential impact on the environment.

Cryptocurrency developers can reduce NFT energy consumption by improving or switching to less energy-intensive blockchain consensus mechanisms. NFT minting and hosting platforms can use blockchains that don't require large amounts of energy.

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