The Craze Around NFTs

People have been spending more time indoors and online since the outbreak of the pandemic in 2020. The coronavirus rocked the globe and sent everyone into a state of complete lockdown, which altered how we live and conduct business. Many people found that their only refuge was the internet.

People have grown increasingly interested in the internet as a whole and the cryptocurrency sphere in particular as a result of protracted quarantines, forced lockdowns, and limits on social gatherings. As the pandemic dragged on in 2021, people were looking for something new to discover, and the buzz surrounding NFTs was all they needed to fascinate them.

It’s interesting to note that many people who lost their jobs and other sources of income as a result of the pandemic’s negative economic effects were able to find new employment prospects using NFTs.

What Exactly are NFTs and How Do They Work?

NFT stands for a non-fungible token, which means that inside those eccentric artworks is a singular, non-transferable data unit that is kept on a digital ledger utilising blockchain technology to create ownership evidence.

The essential technology that underpins cryptocurrencies such as bitcoin and ether is also employed to ensure the individuality of each NFT and establish ownership.

However, because each NFT is entirely unique, it cannot be swapped like-for-like like a unit of bitcoin. Through the blockchain record, the distinct identity and ownership of an NFT may be confirmed. The file contains additional information that transforms it from a kind of currency into, rather, just anything.

As a result, NFTs have developed into collectible digital artefacts that are valuable in the same way that real-world art is.

Why are NFTs so popular?

NFTs are purchased for many purposes. Non-fungible tokens are viewed as investments by certain people who want to gather and sell them as assets. Others simply adore the creativity or innovation of NFTs and enjoy experimenting with their uses. NFTs are increasingly being seen as a method to introduce goods, raise money, and give underprivileged communities a role to represent themselves. Some believe  that NFTs may be the key to another form of democracy.

The most expensive NFT and the most well-known NFT sale in 2021 was Beeple’s Everydays: The First 5000 Days, which sold for $69.3 million.

Control over their products regained for Creators

The creator space has significantly centralised over time. To get their work seen, artists must use certain platforms if they wish to sell anything.

For instance, if you want to sell your music, you will have to hop onto a platform like Spotify or Apple Music. If you want to sell your videos, you will need social channels like Instagram, TikTok or Youtube.

Each of these platforms deducts a fee from your earnings. They give you exposure in exchange for a sizeable cut of your income as payment. NFTs alter this. With NFTs, artists can earn their money directly without always using middlemen. With the middlemen out of the way, content creators can publish their content to their sizeable audience as NFTs, and hence, receive the amount of revenue they should have.

The Dark Side of NFTs: What’s the Outcry About?

However, with new craze of an innovative technology, comes with the scrutiny of high energy consumption that NFTs seem to have. Environmentalists are calling out the community as unsustainable, as a lot of energy is included in the process of mining, minting, selling, and owning these non-fungible tokens.

To produce, to bid, to pay for the NFT after the bid is won or to transfer ownership, transactions on a blockchain are necessary. Therefore, the impact also increases as interest in them grows and more individuals buy and sell them.

So here’s the reason why there are apparently plenty of greenhouse gas emissions associated with NFTs: most of them are bought and traded on Ethereum-based marketplaces like Nifty Gateway and SuperRare. Like the majority of popular cryptocurrencies, Ethereum is based on the extremely energy-hungry “proof of work” technology. On Ethereum, there is a cost attached to each transaction that is referred to as “gas.”

For cryptocurrencies like Ethereum and bitcoin, where transactions aren’t supervised by a third party like a bank, proof of work functions as a kind of security method. The method has users use energy-draining equipment to complete difficult riddles in order to keep bank records secure. By resolving the riddles, users, or “miners,” can add a fresh “block” of authenticated transactions to the blockchain, a decentralised ledger. The miner is then rewarded with fresh tokens or transaction fees.

The procedure intentionally uses a lot of energy. The goal is to make it less advantageous for someone to tamper with the ledger by using excessive quantities of electricity and likely paying a high price for it. Ethereum therefore consumes almost the same amount of electricity as the entire nation of Libya.

Green Token x Meta Carbon: Leveraging NFTs to Support Sustainability Initiatives

Meta-Carbon develops carbon-backed digital collectibles (NFTs) that are 99.9% more energy-efficient than Ethereum and are produced on Polygon. The automated retirement of carbon and issuing of a personal certificate are brought about by the purchase of NFTs. Up to 80% of the proceeds from NFT sales are donated to well-established, registered carbon projects. These carbon projects halt deforestation and protect the area’s threatened species.

Meta-Carbon allows the process of protecting endangered species like trees and animals engaging, transparent, and fun. When you buy a carbon-backed, Carbon Creature NFT, the majority of your money—between 55% and 85%—goes toward buying vetted, registered, and confirmed carbon offsets.

To celebrate International Orangutan Day, Green Token has partnered up with Meta Carbon and Stand for Trees to contribute to saving endangered species. All participants of the Green Token’s first Allowlist sales and giveaways received 1T of Carbon Credits in the form of Meta Carbon’s unique carbon-backed NFTs. The NFT will not only support our Rimba Raya Orangutan Reserve project in Indonesia, but it will also include one tonne of CO2 retired in each member’s honour. That’s the equivalent of saving over 20 mature trees!

As an on-chain cryptocurrency, Green Token has adopted a non-energy intensive approach. Green Token’s own currency, $GREEN, is an Ethereum Request for Comments 20 (ERC20) token that connects the Polygon and BSC networks.

According to the Ethereum Foundation, the PoS consensus mechanism will reduce energy consumption by 99.95%, lowering the number of trees required to offset the required carbon emissions.

As a result, the enhancements ensure safe yet efficient energy utilisation. Validators in a PoS system are chosen based on how much ETH they have staked (deposited) in the network. As a result, they have an incentive to act honourably because doing so risks having their investment reduced or eliminated. Because there will be no more “mining”—thousands of graphic cards competing for the next block—there will be almost no energy consumption aside from the servers that power the nodes.