Quite recently, Twitter introduced a new feature among its latest updates. This feature allowed all users to use certain NFTs as their profile pictures. This was clearly a dedicated effort from the company’s side to take something still in its growing phase and let it divulge into an internet trend. But the only goal this step achieved was leaving everyone, except a select few, befuddled about what was actually happening.
Then came the social media storm where a number of celebrities engaged in talks about NFTs. The whole app was flooded with people left and right posting about how NFTs were just this godsend in times of great distress. Art pieces, songs, videos; celebrities had a field day introducing their work over the NFT platform.
But what exactly is this force of nature that transformed in front of us and baffled us all with its illuminating light?
Well, an NFT or Non-fungible Token as it’s called in technical terms, is a non-interchangeable unit of data that is stored and transferred through blockchain technology and is usually associated with terms of individual digital artistry especially photos, videos and audio. In simpler terms, NFTs are what we call the bitcoin version of Gen Z art. These “tokens” were introduced into the market to easily commoditize works of art and real estate and make their exchange easier.
NFTs were greatly appreciated worldwide for their new and more transparent take on the exchange of such artistic commodities, especially because of how much individual autonomy they gave to independent artists. Moreover, blockchain technology works on a fairly secure and decentralized server, which makes transactions unhackable. Digital assets can be stored and circulated all around the world in just a matter of minutes. Doesn’t that seem pretty cool?
This might look like a feat of technology, a mind-boggling experience at first sight. There were even claims that the infamous Mona Lisa was on sale through NFTs. “So you mean to say that the Mona Lisa would be brought down from the Louvre packed in cardboard and delivered to my doorstep?” was my first question ever since I laid my eyes on NFTs. Well, not quite. My subsequent research (which fairly only involved late-night Twitter stalking) on the NFTs revealed to me the darker and less known side of this new form of trade and even the blockchain and cryptosystems.
Since NFTs were first introduced in a system of blockchain trading, it is fairly common for people to assume them to be an investment. Yet, the general idea of owning an NFT is holding on to something unique and one of a kind. This is exactly the reason certain NFTs such as the Bored Ape ones sell so high in prices. But these forms of digital assets are even more prone to deceit and scam. Due to the high security of private servers in blockchain transactions, there is virtually no way to check the authenticity of certain assets. There might as well be thirty Bored Apes in the market claiming to sell fraudulent commodities under a renowned name and there would only be a few ways to find out if they’re actually real or even hold the fake ones accountable. NFTs might have been a good solution for free creative expression, but they still hold on to certain aspects that sour this very environment of creative skill.
Also, NFTs aren’t just bad for the social environment.
They cause equal harm to the ecological environment as well. Blockchain technologies, especially Ethereum, the platform NFTs work on, have been known for their huge energy consumption. Each individual block in a blockchain is connected and worked on under many computers, which keep increasing their energy consumption for a smoother transaction. If this energy is drawn from fuels with carbon emissions, one blockchain transaction, which takes ten or so seconds, might potentially draw up to eight megawatts of energy, with equivalent emissions and after-effects. These issues take the complexity of the already skeptical environment around NFTs and turn it up a notch.
The question that now arises here is even more complex than the concept of NFTs itself. Are NFTs actually worth it then? Do the advantages really outweigh the harms? Is the limited knowledge about such a new concept enough for everyone to put it on a pedestal and worship it? The internet might say that it will take only a mere couple of years before the NFTs become a common part of market life like any other good. The only thing that’s left to see now is whether the turmoils of time will evolve NFTs into the perfect sense of innovation that people claim them to be.
These questions might take some time to get answered. Till then, all we can do is just sit back and watch the fun unfurl.