MLS is planning to get into the world of non-fungible tokens this weekend, with two live art battles taking place on Friday afternoon – one between artists representing the Timbers and Galaxy, and the other between artists representing the Sounders and Atlanta United. The resulting digital artworks will then be auctioned off as NFTs.
Whatever you may think of NFT’s in general, the decision to participate in this event goes against everything the Sounders are attempting to promote as a “carbon neutral” organization, and it is particularly galling that it was announced on the same day as the league’s annual unveiling of “Parley” kits to promote environmental awareness.
For those unfamiliar, NFTs are essentially a certificate of authenticity stored on a blockchain, which verifies that someone is the owner of a specific asset. The actual asset can be anything in either the real or digital realm which the blockchain entry identifies, but most often NFTs represent digital images, videos or audio clips. In the abstract, the idea of a fully public and verifiable chain of custody is good, but the proof-of-work blockchain technology currently underpinning NFTs is fraught with myriad issues, both ecological, technical and legal.
We won’t dig into the legal or technical issues here (except to note that your ownership of the “original” digital art doesn’t stop anyone else from making a copy of it and sharing it), instead focusing on the ecological red flags. In short, the cryptocurrencies used to support these blockchains are a significant source of pollution. The computer systems that mine the currencies and validate transactions are highly specialized, have driven up demand for rare earth metals and caused the price of high-end graphics cards to skyrocket. The systems also rapidly become obsolete and add to the growing problem of electronic waste and pollution.
The energy demands of these systems are also immense. In February, it was calculated that the bitcoin network alone was using more energy than the entire country of Argentina. In some areas, fossil-fuel power plants which would otherwise be idle or have been decommissioned are being brought back online to meet the demand, and even in areas with relatively green power, the additional power draw is not without concern. Increased demand for hydropower, for example, can draw down reservoirs and influence local ecology, making areas more susceptible to future weather perturbations.
NFTs require a transaction on the blockchain (and thus the expenditure of cryptocurrency and resulting pollution) at every step of their lifecycle. There’s an expenditure when they’re minted. There’s an expenditure when they are listed for sale or auction. There’s an expenditure when they’re sold. The people who want to bid on the token need to acquire cryptocurrency, which has to be mined by someone. Each of these steps adds greenhouse gas emissions for little tangible benefit that couldn’t otherwise be achieved with something like a notarized certificate of authenticity.
Although the Sounders claim a portion of the proceeds will be used to offset carbon emissions, which will make the collaboration “completely carbon neutral”, carbon offsets are notorious for overpromising and under-delivering. It’s noble for the Sounders to make an effort to fully offset things related to their necessary daily operations, such as travel to away games and stadium energy usage, but the ultimate end goal should be to reduce overall energy usage, not to just throw some money at an easily avoidable problem of their own making and wash their hands of the issue.