NFTs: What are they and why are they so popular? – UNF Spinnaker

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nfts:-what-are-they-and-why-are-they-so-popular?-–-unf-spinnaker

Majdouline Bakor, Multimedia Journalist
October 4, 2021

In the new age of cryptocurrency, NFTs are a new economic collectible form of digital art. The popularity of NFTs has begun to rise on the internet. However, it seems they’ve contributed to technology’s negative impact on the environment, as reported by CNBC.

 Graphic by Majdouline Bakor.

What are NFTs?

NFT stands for a Non-Fungible Token which is a digital file stored on a blockchain network. The blockchain network records and distributes digital information. The unique thing about NFTs is that it is the original file. An example of this in physical terms is a one-of-a-kind painting like the Great Wave off Kanagawa by Hokusai. Although there are a bunch of copies and prints of the art piece, there can only be one owner of the original.

The person who has ownership over the file has custody of it permanently, which makes it nearly impossible to try and copy the properties of the original. NFTs are created so that there’s one like no other. When selling an NFT, you are giving all the ownership and rights to the buyer.

What are some NFTs that have already been sold?

After receiving around 900 million views on YouTube since 2007, the old legend “Charlie Bit My Finger” is one of many that has been sold as an NFT for $760,999. Since then, the family has taken down the original video on YouTube.

Photo by HDCYT/YouTube.

Chris Torres, creator of the famous Nyan-Cat created a remastered version of the art and sold it as an NFT for $590,000.

Screenshot from Nyan Cat/Youtube.

Twitter CEO Jack Dorsey (@jack) tweeted the first-ever tweet on the platform in 2006. His tweet reads “just setting up my twttr” which sold for $2.9 million to CEO of Bridge Oracle Sina Estay. Dorsey forwarded the funds from this NFT purchase to charity GiveDirectly for COVID-19 relief resources in Africa.

just setting up my twttr

— jack⚡️ (@jack) March 21, 2006

What’s NFTs impact on the environment?

NFTs are a type of cryptocurrency. With this comes crypto climate concerns. Ethereum is a form of currency also known as Ether or ETH. Ethereum is a blockchain platform, it creates and shares financial services, entertainment applications, and business affiliations.  

Ethereum with NFTs is a type of security. It allows developers to publish without any risks of fraud or interference from other parties. Since NFTs have only one owner at a time they’re secured by the Ethereum blockchain which stores extra information than a typical ETH coin. This guarantees the buyers original rights when purchasing, or proof-of-work (PoW) security.

NFTs contribute negatively to the world’s energy consumption and carbon footprint. According to the Digicnomist, Ethereum consumes roughly 74.4 terawatt-hours of electrical energy annually compared to countries like Austria and Colombia. The practice of crypto mining, which validates cryptocurrency transactions, generates a ton of electronic waste (e-waste).

Graphic by Majdouline Bakor. (Maj Bakor)

With high-rise tensions surrounding the longing negative effects of cryptocurrency, Ethereum has prepared to take big steps into turning green.

The Merge is Ethereum’s new plan to cut energy consumption by 2022, and upgrade their network’s energy use by over 99%. This cut will take on a new form of validation transactions called “proof of stake”, which will take the place of cryptocurrency mining. This form will involve people to become validators. This process is also known as the Ethereum 2.0 (Eth2) Vision. Currently, Eth2 researchers are working on more ways to accelerate the process of the merge.

“Now that the technology is ready, these upgrades will re architect Ethereum to make it more scalable, secure, and sustainable – to make life better for existing users and entice new ones. All while preserving Ethereum’s core value of decentralization.” Eth2 Vision states on their website.

Recent updates on their progress can be found here.

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For more information or news tips, or if you see an error in this story or have any compliments or concerns, contact [email protected].

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