Understand the environmental impact of digital collectibles

NFTs have taken pop culture by storm over the past year. Almost every day a new celebrity expresses their interest in the emerging technology – usually by dropping an NFT collection. By Quentin Tarantino pulp fiction From NFTs to Snoop Dogg’s NFT music label, a wide range of notable names are beginning to recognize the creative value that NFTs offer. While celebrity involvement has played a key role in raising mainstream awareness of the multitude of NFT use cases and investment potential, it has also drawn the ire of some fans.

Amid the hype surrounding the NFT phenomenon, concerns have grown about the environmental impact of the technology. In one notable example, popular South Korean boy band BTS faced a major setback a few months ago in response to their plans to debut their own NFT collection. The backlash experienced by BTS is one of many similar cases, leading some artists to be wary of exploring the NFT trend for themselves.

What many fans miss is this is possible to create NFTs in a way that is not at the expense of the environment. In fact, many NFT platforms have adopted greener mining methods by integrating energy-efficient blockchains like Tezos, Flow, Polygon, and Solana. These blockchains use a consensus mechanism called Proof-of-Stake (PoS) to validate transactions on the blockchain, such as B. minting an NFT. This type of consensus mechanism requires significantly less power than Proof-of-Work (PoW), the previously dominant method of validating transactions, as we’ll explain in a moment.


However, given the amount of jargon and misinformation surrounding NFTs, the barrier to entry can prove overwhelming when it comes to doing your due diligence. Before an artist enters the NFT arena, four key factors need to be considered to maximize eco-friendliness: PoW, PoS, sidechains and carbon neutrality.

Related: How blockchain technology is changing climate protection

proof of work

Environmental concerns related to NFTs arise primarily from a consensus mechanism called proof-of-work. In essence, PoW acts as a security detail for cryptocurrency transactions. To ensure transactions are safe and legitimate, computers must solve random mathematical puzzles to verify them. The computers involved in this process require large amounts of electricity, hence the community backlash some celebrities have received after launching NFTs on PoW chains.

Related: Green Bitcoin: The Impact and Importance of Energy Consumption for PoW

Proof of Stake

Fortunately, not all blockchains require PoW, and contrary to popular misconception, NFTs can be minted in an environmentally responsible manner. This is where Proof-of-Stake offers a compelling solution. Unlike energy-guzzling computers that must solve puzzles to verify transactions, PoS simply requires individuals to stake their cryptos to participate in transaction validation and earn rewards.

As mentioned, some popular PoS blockchains include Tezos, Flow, Solana, and Polygon. Tezos in particular has attracted a lot of attention because of its low energy consumption – for a simple comparison: 50 million transactions on Tezos cause CO2 emissions from just 17 world citizens.

Related: Proof-of-Stake or Proof-of-Work, that is the question

Additionally, one of the leading blockchains in the NFT ecosystem – Ethereum – will soon switch from a PoW to a PoS system. According to the Ethereum Foundation, the upcoming switch of the network from PoW to PoS, rumored to happen this fall, will allow it to become about 2000 times more energy efficient and reduce overall energy consumption by 99.95%.

Sidechains and Layer 2 solutions

Another alternative to circumvent PoW’s excessive energy consumption are sidechains, independent blockchains that operate in parallel to mainchains like Ethereum. This independence allows sidechains to enact their own rules regarding transactions, security, and governance. Since sidechains do not have to rely on a distributed network of computers to verify transactions, their carbon footprint is greatly reduced.


A great example of a popular sidechain in the NFT space is Polygon. Notably, Polygon is also a third-party Layer 2 solution or protocol that supports the Ethereum mainchain by improving transaction speed and gas efficiency. The community-driven nature that many of these sidechains offer is particularly well-aligned to creators and developers trying to build mutually beneficial economies with their fans, making sidechains a compelling option for those entering the crypto space.

climate neutrality

Whether a project uses PoW, PoS, or sidechains, it’s important that they acknowledge and uphold accountability for their carbon footprint.


There are many ways projects can make dedicated efforts to achieve carbon neutrality, such as: Take, for example, Rarible’s integration with popular carbon removal marketplace Nori earlier this year, allowing anyone to offset the carbon footprint for most Ethereum NFTs listed on Rarible.

Given these factors, it’s important that artists do their due diligence to ensure they choose NFT marketplaces and projects that uphold their values.

Related: ​​Green finance needs voluntary CO2 markets that work

While some have coined NFTs as a money grab with no regard for the environment, this characterization misrepresents the community-oriented intentions of the Web3 futurists and innovators behind the technology. By adopting green, user-centric NFTs, artists can unlock a new realm of opportunities to build connections and share values ​​with their fans.

This article does not contain any investment advice or recommendation. Every investment and trading move involves risk and readers should do their own research when making a decision.

The views, thoughts, and opinions expressed herein are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Alex Salnikov is the co-founder and chief strategy officer of Rarible, a community-centric NFT marketplace. A blockchain pioneer and active developer in the crypto space since 2012, Alex previously served as Chief Technology Officer at CoinOffering, the first company to offer its shares in the form of blockchain assets. With a BA in Computer Science and an MA in Data Science, Alex’s areas of expertise span a variety of sectors including Market Analysis, Decentralized Finance, NFTs and Tokenomics.