An NFT on Ethereum consumes as much energy as a Tesla travelling 450 kilometres. The Ethereum network has reached an annual energy consumption of Pakistan.
NFTs on Ethereum: energy consumption similar to a Tesla
The debate over the energy consumption of blockchains seems to have resurfaced with the explosion of the NFT (Non-Fungible Token) market.
In fact, it seems that the energy consumption of an NFT on Ethereum, the blockchain par excellence used for this purpose, is equivalent to the consumption of a Tesla Model S 75 when travelling about 450 km, or roughly the distance between Rome and Milan.
According to reasonably up-to-date estimates, an Ethereum transaction, the very process used to create or sell an NFT, today consumes 214 kWh and this is because it is still based on Proof-of-Work (PoW) – like Bitcoin – which involves mining to confirm transactions.
This means that, in one year, Ethereum’s annual energy consumption puts it at around 97TWh, almost 10 gigawatts, comparable to the consumption of Pakistan, a country of 220 million inhabitants.
In contrast, the energy used annually by the validators of the Tezos network, a blockchain based on Proof-of-Stake (PoS), is probably in the order of 60 MWh, a continuous consumption of perhaps 7 kilowatts.
Ethereum’s energy consumption: “PoW vs PoS”.
The PoS of Tezos is staggeringly more efficient in terms of energy savings than the PoW of Ethereum.
After all, it is well known that the PoW of Bitcoin, and even of Ethereum, is more environmentally demanding than the PoS of Tezos and other blockchains.
Even Elon Musk, CEO of Tesla, had pointed this out in his tweets when he said that he would only return to accepting Bitcoin as a method of payment for Teslas when at least 50% of the energy used for mining BTC is renewable or green energy.
Obviously, PoW is far more democratic and decentralized than PoS in that it involves mining versus staking to proceed with transaction confirmations.
Therefore, unlike Ethereum which is in the process of making the transition from PoW to PoS, the Bitcoin and other PoW blockchains can become more energy efficient only if the energy used in mining is replaced.
Ethereum 2.0 developments
Earlier this month, requests for community support to test the merge to PoS of Ethereum 2.0 were circulating on the social network of crypto-lovers, Twitter.
Developer Marius Van Der Widjen is a clear example of this, having created a new programme through which, in a self-guided and free way, people can decide how much time and effort they want to devote to PoS merge testing.
At the moment, the merge tests involve the merger between Ethereum’s traditional Blockchain, the one born in 2015, and the Beacon Chain, the still experimental PoS Blockchain launched in December 2020.