NFTs, Climate Change, and All That Jazz

I had written this article while researching NFTs at work back in May/June 2022. It covers thoughts and research around emerging blockchain technology, capitalism & art, climate change, women’s unpaid labour, and the debunking of the GDP myth.

“The ultimate, hidden truth of the world is that it is something that we make, and could just as easily make differently.” – David Graeber

When Anil Dash and Kevin McCoy invented the non-fungible token (NFT) in 2014, they were trying to find a way to ensure artists could have control over their digital art. As avid Tumblr users, Kevin McCoy and his wife Jennifer were digital artists whose work was frequently reblogged and Kevin was thinking how he could use the blockchain called Namecoin to assert ownership over digital art. During a hackathon in May 2014, Kevin and Anil created a blockchain-based means of assuring digital ownership over a video clip and they named it ‘monetised graphic’. They presented a rough draft of it at a hackathon in NYC and then were invited at TechCrunch Disrupt NY to showcase it to the who’s who of the tech world. In the same year, the UN Intergovernmental Panel on Climate Change (IPCC) released their Fifth Assessment Report (AR5) whose Working Group III stated that the then trajectory of global emissions was not consistent with limiting the global warming at 1.5 degrees Celsius. This was ahead of the Paris Climate Agreement that was passed in 2015.

Eight years have passed, cut to today, monetised graphics are now called Non-Fungible Tokens (NFTs) that have been selling for millions of dollars for a line item in a ledger on a blockchain, and the IPCC has released their Sixth Assessment Report (AR6) whose Working Group III has stated that we have passed the point of limiting global warming at 1.5 degrees Celsius and Earth is “firmly on track to be an unlivable planet”. We all know that NFTs are hailed to be the revolution in what could seem a space to give artists and creators ownership of their work, however, there are concerns about them being environmentally irresponsible due to the vast amount of energy needed to mint NFTs. Even in the last eight years, there is little to no proof of the fact that NFTs could be a viable solution for breaking the capitalistic mould that traps artists and doesn’t allow them to have control over the art they create and get paid for it fairly. Somehow, I have come to assume that we are past the point where it needs to be explained why NFTs are not the great idea they seem, but I will back it up a little here.

Arguably, we do have tech geeks across the world working on bringing down the energy consumption of a typical blockchain. To put it in perspective, though, Bitcoin hardware generates massive amounts of e-waste as it is a singular use hardware. If you had to compare Bitcoin energy consumption against what we currently use here’s a statistic: 10,000 Visa transactions = 40 grams e-waste; 1 Bitcoin transaction = 285 grams e-waste. I’m not great at math anymore, despite my father having tried very hard, so I will hazard that you’ll do the calculations. It’s just not efficient to handle the billions of transactions, we as a planet, are doing every day. In 2021, Bitcoin mining consumed 134 Twh of power which negates the entire global savings from deploying Electric Vehicles (EVs). At the risk of digression, as we recently learned during my senior’s session, the amount of e-waste that EV batteries are set to generate is not forecasted, so it is also hard to say if EVs are the energy solution we think they are. Besides, it’s also good to note that almost all EVs are currently powered by energy that comes from fossil fuels. It’s the classic chicken and egg problem. But Bitcoin is so passé! Sure, it is. Etheruem’s annual energy consumption is around 110.55 Twh which is equal to the energy consumption of all of Netherlands. A whole country, that’s right. Ethereum has been moving to Proof of Stake (PoS) for as long as it has existed and I have no doubt in my mind the tech experts are working on a solution. Polygon, the Layer 2 blockchain that’s built on top of Etheruem calls itself the eco-friendly blockchain and even the World Wildlife Fund (WWF) used it to mint eco- friendly NFTs called ‘Tokens for Nature’, but when it drew much criticism for it they quietly cancelled it. Polygon consumes 35-140 Twh of electricity, which is roughly that of energy consumption of Singapore, and Polygon uses Proof of Stake (PoS) which the argument says uses much less energy that Proof of Work (PoW) to verify the transactions. I have no doubt in my mind that tech experts can solve the energy problem. I’m always in awe of how smart humans can be, but the problem is, as per the new IPCC AR6, as a planet and a species we don’t have the luxury of time anymore.

So, what are we supposed to do? Walk away from emerging technology? Even if we don’t use it, someone else will! Fair enough. With this rationale in mind some of us dipped our toes into the NFT space and thought we should combine the two — mint an NFT but for a climate cause so we can support a greening initiative in the physical world. So far, the criticism for our idea has been nil, but loud and clear in my own head and I’ve kept it in there. In order to do so, we had to find a cause we believed in. I firmly believe in wanting to continue to live, so I was inclined towards supporting a cause that would cool down my city. A senior at work suggested we should support the cause of building a Miyawaki forest which is a concentrated forest inside a city that works as a carbon sink. The NFTs that are up for sale can go towards the proceeds to raise money for an NGO that does this work. The digital art we create for the NFT could be uploaded the NFTs on OpenSea or a similar NFT marketplace. We would need to create a Metamask account (to link it to OpenSea or another marketplace) that would work as the wallet. Whether this NFT would have re-sale value or not was a point of discussion for us as well, and how would we attach value to it: in terms of money donated or time volunteered. After the Budget of 2022, another colleague also asked us to consider that the money made by this NGO would be taxed at 30% and the donors would not get a tax benefit in donating to the NGO, if they did so by buying our NFT.

A Miwaywaki forest is a method of forestry invented by Japanese botanist Akira Miyawaki that compresses layers of a forest — shrubs, trees, canopies — into a patch of land the caveats being that the vegetation planted should be local, the saplings should be densely populated, and the land should receive approximately 8 hours of sunlight a day. A Miyawaki forest grows to full height in about two years as compared to a regular forest that takes up to hundreds of years. It also attracts local fauna such as birds and bees and was a climate change measure formally adopted by India under the Paris Agreement.

Green Yatra is the NGO that plants Miyawaki forests in Mumbai and the Mumbai Climate Action Plan also lists urban greening via Miyawaki forests as a goal for the next few years. When I spoke to Green Yatra about our idea of helping them raise funds via an NFT drop, I learned a couple of things. They’ve already completed a Miyawaki forest in Koperkhairane in Navi Mumbai and it is open for all to see. Additionally, the Indian Navy and Green Yatra planted a Miyawaki forest in Malad in 2020 and it is the largest Miyawaki forest in Mumbai city. A typical corporate donation would involve 1000 or 2000 saplings at a time for it to be useful to them, and they’re never short on man-power or volunteers as they have support from schools, colleges, and municipalities. Typically, 1000 saplings cost around 5.5 – 6 lakhs so that’s the kind of money we could have to raise. The plot of land to set up a Miyawaki forest is given to Green Yatra by local municipalities and is usually barren land which is of no use (which is quite something to say in a city like Mumbai!) Additionally, Green Yatra’s latest Miyawaki forest project is happening 9 mins away from where I live (i.e. 1.3 km for folks who measure distance in kms). If someone wants to volunteer to plant saplings in these forests, all they need to do is sign up on their website. Green Yatra does take individual donations as well and their Web site has a page for it.

Miyawaki Forest Prep in Nerul, Navi Mumbai
Miyawaki Forest Prep in Nerul, Navi Mumbai

At this point, all of it sounds well and good, so I looked up the green cover of Mumbai city and found a not-so shocking study. A study superimposes the data on green-cover of Mumbai with the data on the socio-economic strata of my city. Unsurprisingly, the economically poorer areas have a much lesser green cover than the economically well-off areas. The fact that climate change is an economic and geo-political issue was never a contention. However, the IPCC backs up this claim in more ways than one. The IPCC has three Working Groups (WG) comprising 270 authors from 67 countries. 57% of these authors come from developing countries. Working Group I assesses the scientific aspects of climate change. Working Group II assesses vulnerability of socio-economic and natural systems to climate change. Working Group III assesses options for limiting greenhouse gas emissions and options in mitigating climate change. The AR6 WG3 report came out in April 2022, which is the one that has confirmed we have missed the window to limit global warming at 1.5 degrees. Every chapter of the Working Group’s findings has two lead authors on it — one from the Global North and one from the Global South. This is to ensure equal representation from both sides of the hemisphere specially vis-a-vis the fact that the Global North countries are developed while the Global South countries are still recovering from the destructive effects of colonisation by their Global North invaders. Even this authoritative IPCC report acknowledges at the outset the impacts of socio- economics and the unequal distribution of power on climate change as a whole. So it is not surprising to me that Mumbai as a city shows the same socio-economic trends that the world at large displays. What I find interesting about the findings of the WG III Chapter 5 is that there is actual substantiation that every single person on this planet can live a comfortable life with half the energy that we currently consume. The IPCC report while stating that we have botched up our quality of life in the long-term also states that it is possible for us to stop our indecent consumption and make actual policy changes to allow human life to sustain and even prosper. They also issue a separate summary for policy makers on how these changes can be brought about. In the ages of pre-Internet, scientists said that we may not have been able to make informed decisions because of absence of enough information. Currently, even though we have all the information at hand, all the countries and corporations have failed to hold to any of the promises made at any of the Climate Summits. So, this time, the IPCC has included a new chapter on the role of the media in accelerating climate change by allowing disinformation to run rampant. And then, Bob’s your uncle.

I’m really in the last stretch here, so stay with me. What I find even more interesting is that this information on climate change can be coupled with the debunking of the GDP myth as a driver of economic prosperity. Economic prosperity drives imbalance of power among nations and therefore, resulting in unequal use of resources, and therefore, well, climate change. The GDP of almost every single country (except maybe New Zealand in the near future) doesn’t account for unpaid labour because it has been agreed upon by the UN countries after the Second World War that if a labour is not “productive” it is not a part of the GDP of a country. Therefore, oil rigs and wars contribute to the GDP of a country but child-rearing and housekeeping are valueless. According to a McKinsey report, women’s unpaid labour amounts to 10 trillion dollars towards annual global GDP, and upto 12 trillion dollars by 2025 if only women were given an equal status in society. However, as this is not an input into any country’s GDP, it is lost out. Not just women’s unpaid labour, any recreational, well-being, or community-activity that is essential to living but not accounted for in a monetary way does not add to any country’s GDP. Yet, most countries would not be able to function without these key activities as the pandemic has made clear to us. The way our economics are currently designed, whatever is of actual value, unless it is not transacted accounts towards nothing. This is the emulation of the fact that a forest has no value in our world until it is cut down. Forest after forest is cut down, large multi-nationals are given contracts to exploit their minerals and other bounty, and all this is added to the GDP of a country to measure its prosperity. Our free time is also being monetised to account for economic prosperity. Every time, we do something that is “not productive” that’s the GDP giant machine losing out on transactions it can record. There’s a reason why it is called the “attention economy”. While the pandemic was a hellish dreamscape, it did give us a chance to reckon with what “jobs” we value and how we measure “success and growth”. We saw that unpaid labour was a huge aspect of our lives, childcare, elder-care, and access to affordable healthcare and community support are essential to living. Yet, not a single country’s GDP accounted for any of this, unless it was in the form of vaccine sales or the retaining of IPR rights on the Covid-19 vaccine. Who would have thought it would take a nightmare of a pandemic to re-prioritise how we live? But the truth is that we haven’t re-prioritised as much as we think. If the IPCC report is anything to go by, we will see more pandemics in the future due to the melting of the permafrost. We are not ready for any of that.

This brings me back to the original problem that Anil Dash and Kevin McCoy were trying to solve — how to ensure artists get their due credit and control over their art while also keeping the money they make from it. Art, in all its forms, is not useful to society unless it has a monetary value attached to it. Now, I’m not saying artists should not be paid, but I among many others, question the premise of what we attach “value” to. Yet, again, the hellish pandemic has made it amply clear that if it weren’t for art to have sustained us in the last two years, we might not have made it to the other side. Therefore, at the risk of making a grand claim, I think the problem that Anil and Kevin were trying to solve is correct, but they went about it in the wrong way. Technology will not be able to solve this social problem we have created — to devalue rest, well-being, and creative sustenance in order to increase made-up economic statistics as means of development. This is a means of holding power over the heads of those made less fortunate by these structures, and therefore deciding the value of life — both human and every other species — by attaching a monetary value to it. There is actual proof of the fact that as we hurtle close to the unlivablity of this planet, the carbon consumption of economically prosperous countries will affect the economically disadvantaged people. To put this in perspective, the agricultural belt of the Global South will start to become seriously affected because the carbon emissions of the Global North are nowhere near being controlled. This is not an anecdote. This is a science-backed claim.

So, it becomes incumbent on us to weigh the problems we are going to solve and how we are going to solve them. How do we attach value to art whether physical or digital?

How are our artists validated and paid for having to live in the world we created? How do we prioritise human well-being (physical and mental health) in ways that we don’t burden people for the basic act of wanting to be healthy? How do we account for unpaid labour that actually sustains our societies? How do we design our cities and spaces better for accessibility and intersection? How do we prioritise rest and recuperation without turning it into a gamified frenzy? Over and above, we need to always ask ourselves: are we trying to solve the right problem and what unintended consequences this could have in the large scheme of things? Hard questions, I know, but I would imagine they’re also the most worthy ones out there.

Sources and References:

  1. Seven on Seven 2014: Kevin McCoy & Anil Dash | Vimeo 
  2. IPCC Sixth Assessment Report AR6 | IPCC
  3. Bitcoin and Ethereum Consumption Index | Digiconomist
  4. How the World Wildlife Fund tried — and failed — to create an eco-friendly NFT | The Verge
  5. The Miyawaki Method: A Better Way to Build Forests? | Jstor
  6. Green Yatra NGO | Web site
  7. Mumbai Climate Action Plan | Web site
  8. Linking remotely sensed Urban Green Space (UGS) distribution patterns and Socio-Economic Status (SES) – A multi-scale probabilistic analysis based in Mumbai, India | TandFOnline
  9. Conflicts of Interest, Debunking Demand, Media Manipulation & More IPCC Report Part One | Spotify
  10. The unpaid work that GDP ignores — and why it really counts | Marilyn Waring | YouTube
  11. How advancing women’s equality can add $12 trillion to global growth | McKinsey

Additional Reading:

  1. NFTs weren’t supposed to end like this | The Atlantic

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