Your guide to the basics of non-fungible tokens, and why they lowkey suck.
Don’t worry, millennials., NFT isn’t the latest acronym teens are texting to their friends à la BRB or LMAO. NFTs, or non-fungible tokens, are the newest craze sweeping the tech —and art and entertainment and business — world. If you’re like me, you’re probably still confused. What the hell does non-fungible even mean? And tokens? Like, those things you used to use to play games at Chuck E. Cheese during your best friend’s seventh birthday party?
Let me break it down.
Basically, non-fungible is a fancy way of saying “unique and unable to be replaced by or interchanged with another identical item.” For instance, a dollar bill traded for a dollar bill is fungible because each item has the same value and can replace the other identically. On the other hand, an authentic 1-of-1 autographed picture of Kanye West traded for a one-of-a-kind baseball card is non-fungible because neither item shares the same value or is able to be replaced. The concept of tokens comes into play because NFTs operate in the digital space.
If this whole thing is still unclear, not to worry! It’s suuuper complicated. NFTs are basically proof-of-ownership of any unique digital item that is unable to be replaced: a video clip, a piece of art, a song (Lindsay Lohan original music, anyone?), even a Tweet. NFTs are, at this point, mostly pieces of digital artwork. Artists like Takashi Murakami, Banksy, and Beeple (who sold an NFT for a whopping $69 million) have begun cashing in on NFTs.
Cryptocurrency Ethereum is the main platform on which NFTs are traded and dealt. If unclear, no two NFTs are the same, which is a really fun way to market exclusivity 😐 ! This exclusivity contributes majorly to the allure of NFTs. Each NFT can only have one owner at a time, and the security of the Ethereum blockchain ensures this. Think about it like this: if you are the owner of a Murakami NFT, you would be the sole owner. You would also have the freedom to trade your NFT for something else, like another NFT art piece or even tickets to a concert, or even sell it for cryptocurrency. For a handy comparison between the internet we’re used to and the internet if NFTs were used everywhere, click here.
Theoretically, the NFT in question could just be reproduced/screenshotted/recorded and distributed to all — it just wouldn’t be the original and therefore wouldn’t have “real value,” even though the value is arbitrary and based on the cryptocurrency market. In layman’s terms, NFTs are meant for rich people who are running out of ways to spend their money (when they could easily take a screenshot of the digital art in question and instead use their millions to eradicate homelessness, end student debt, and contribute to mutual aid networks... *sips tea*).
Wait, this sounds like it could be super unsustainable.
In theory, NFTs sound super cool and revolutionary! In many ways, they are. But what’s being left out of nearly every conversation about them is the intense impact “mining” for NFTs has on the environment. This crypto art-dealing is partially responsible for “millions of tons of planet-heating carbon dioxide emissions generated by the cryptocurrencies used to buy and sell them,” according to The Verge.
There is a ton of energy needed to maintain the cryptocurrency platforms that deal NFTs. In fact, Ethereum uses approximately as much electricity as the entire country of Libya. Many of these companies are filling giant warehouse spaces to the brim with powerful, energy-consuming computers running software that, in simple terms, turns energy into wealth — a practice that is disgustingly unsustainable.
In a world that is already struggling to keep up with the climate crisis, where does this leave us?
Not to doompost or anything, but I’m fucking terrified.
Hopefully this cleared up some of the confusion surrounding NFTs. Since they’re very new to the cultural and technological landscape, there is still much more to be learned and figured out. It’s frustrating that the newfound popularity of NFTs have put artists and creators in the position to commodify their work like this, but at the end of the day I’m just a liberal arts girl living in a tech bro world. So, what can ya do!
Madison Rosenfield is an Online Writer at Rowdy Magazine. When she's not going down internet rabbit holes at 2 AM, she can usually be found curating the perfect Spotify playlist, celebrating her Jewish heritage, crafting, watching coming-of-age films, or taking action in support of causes she cares about. You can find her at @madisonrosenfield on Instagram or @madisonleahh on Twitter to get a deeper look at her passions and perspectives.