Recently, WWF UK joined the NFT circus with its Tokens for Nature collection. But even before fundraising began, the project sparked a backlash from online environmentalists who worried about its carbon footprint.
Within days, the sale was completed.
The NFAs (or Non-Fungible Animals) project aimed to raise a lot of money and raise awareness for endangered animals. The number of rare animal images available for sale matched the estimated number left in the wild.
There were 290 NFA giant ibises, for example. An ibis jpeg would have raised around US$400 in a single sale.
According to one estimate, NFTs generate more carbon emissions than Singapore due to their energy consumption.
Most NFT creators use a technology called Ethereum, which is a blockchain system similar to Bitcoin that involves a power-intensive computing function called mining.
Specialized mining computers take turns validating transactions while guessing the combination of a long string of automatically generated numbers.
The computer that correctly guesses the combination first wins a reward paid in a cryptocurrency called ether.
Unlike regular NFTs, the WWF claimed that its NFAs were “eco-friendly”. In its sustainability statement, the charity suggested that selling the roughly 8,000 NFAs would have a carbon footprint similar to a pint of milk or half a dozen eggs.
The reason for this negligible impact, they say, was a smart blockchain app called Polygon, which would have allowed the WWF project to reduce direct interactions with the Ethereum blockchain.
WWF would then not have to bear as much responsibility for its share of Ethereum’s monstrous carbon footprint.
So why the tantrums on Twitter?
The WWF hypothesis was tricky. This is because Polygon depends on Ethereum contracts to perform essential services, such as moving assets between Ethereum and Polygon and creating checkpoints between the two.
According to Alex de Vries of cryptocurrency monitoring website Digiconomist, the footprint of the WWF project was actually about 2,100 times larger (12,600 eggs) than the estimate provided by the charity.
There are also second-order effects to consider. Ethereum’s carbon emissions are not directly related to the number of transactions made on the network. PoW mining is what gives Ethereum its dirty reputation.
By inflating the hype around NFT markets, the collection could drive up the price of Ethereum. This would further encourage PoW mining, thereby increasing the overall carbon footprint of the network.
Early NFA buyers would buy them from the dedicated WWF website. But buyers can relist their works on the popular NFT marketplace, OpenSea.
OpenSea is currently the top gas consumer on the Ethereum network, responsible for almost 20% of the actions on the blockchain.
The WWF isn’t the first charity to reevaluate its stance on crypto donations.
In 2021, Greenpeace stopped accepting bitcoin donations after seven years. Friends of the Earth quickly followed.
The WWF fury has forced wildlife charity International Animal Rescue to put its NFT fundraising plans on hold indefinitely.
Internet nonprofits Mozilla and Wikipedia have also reconsidered their crypto-distribution strategies due to climate change.