Fintech

Dark side of NFTs: Why collectable digital art may challenge investors’ ESG targets

One artist said the 10-second sale of his NFT series used up more electricity than his entire studio in two years

A piece of work by Hoxxoh on show at the opening of Superchief Gallery NFT, a physical gallery dedicated to NFT artwork in New York. Digital artworks are rising in popularity but come with a hefty environmental footprint due to the mining process used to create them
A piece of work by Hoxxoh on show at the opening of Superchief Gallery NFT, a physical gallery dedicated to NFT artwork in New York. Digital artworks are rising in popularity but come with a hefty environmental footprint due to the mining process used to create them Photo: Timothy A. Clary/Getty Images

Digital collectables and artworks minted via a cryptocurrency-esque token, or non-fungible tokens, are posing a new problem for investors and art dealers alike as they rise in popularity.

Authenticated using blockchain technology, original copies of these one-of-a-kind digital items are stored and sold using a token that acts as proof of ownership.

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