Response from ART3 on NFTs

Earlier this week, The British Journal of Photography announced that they have entered the NFT arena with the launch of ART3, a better way to collect, sell and own photographic art.

This coincided with my blog post last Sunday, so I wrote to The BJP expressing my concerns.

They replied to me last night and published it on Google Drive.

If, like me, you do your best to avoid signing in to Google, you can find their response below followed by the reply I’ve just sent them.

As you’ll see, and as I mentioned on Sunday, the topic of NFTs is a huge rabbit hole. After this post, I will likely take a step back before it consumes my entire life but I’m glad my missives have been so helpful to so many and, at the very least, that they’ve spurred on the much-needed conversation about such a controversial topic.

If you would like to submit your own thoughts to ART3, you can do so here.


On a separate note, I would like to thank Andy Barnham who has been my guide on this intricate and bumpy path, shining a bright light into the darkest corners of the rabbit hole that keeps on getting deeper the further you look.

You may remember that I quoted from Andy’s own blog post about NFTs and you can catch him on Twitter. Thank you, Andy!


27th October 2021

Dear Jack,

Thank you for your email and I have read your blog post which includes some interesting points. As our minting policy states, we also care deeply about the environment and did our own in-depth research into the points you make before we launched ART3.io

While we agree that minting NFTs directly on blockchains like Ethereum that use a “proof of work” mechanism is very costly in terms of energy consumption (and associated fees), the same doesn’t apply the blockchains that use a next generation “proof of stake” system, which has a significantly lower energy consumption. I recommend this NBC article, which provides a great introduction to the two different blockchain technologies, and explains how “energy consumption for proof of stake is 99.99 percent lower than proof of work”. 

To mint our NFTs, ART3 uses one of the leading proof of stake blockchains, Polygon, which claims credentials as the most eco-friendly blockchain. Polygon records transactions on its own chain using “ZK-rollup technology” rather than writing each transaction to the main Ethereum blockchain. This offers transactions with comparable carbon intensity to many other mainstream internet applications, such as email, cloud storage, internet search etc, that we all use daily.

As with many new technologies, blockchain and NFTs have started inefficiently and will improve rapidly over time. In fact, the entire Ethereum chain is well on its way to completing its imminent migration to proof of stake in the coming months. But, given the well publicised environmental impact of first generation proof of work blockchains it is hardly surprising, and right, that hard questions need to be asked and answered on these issues. This has certainly been our approach.

The decision to mint using Polygon, as opposed to minting directly to Ethereum, was taken by ART3.io, despite direct minting to Etherium offering more flexibility (e.g. Ethereum minting on OpenSea allows auction pricing, whereas Polygon only offers fixed pricing). Indeed, almost all of the biggest NFT projects still use Ethereum minting for those benefits. ART3.io are proud to say that we are one of only a tiny fraction of NFT sellers minting using Polygon and putting our environmental principles first. By leading the way on this, we are hopeful that we can set an example to others that success is possible minting on Polygon, so they have the confidence to follow in our footsteps.

Per some of the comments on your own post, there are significant benefits to NFTs or smart contracts which will be game changing for both collectors (being able to prove provenance and edition scarcity) and artists (being able to monetise their work and earn royalties on future sales). These are the tools which we are excited about, and which we will continue to explore as part of our long-held mission to help photographers realise their creative potential.

I would really encourage you to do your own deep research – starting with the links I have shared and going deeper from there – to gain a deeper understanding of the nuances of blockchain technology like proof of work vs proof of stake, roll-ups etc. The facts, I am sure, will put your mind to rest, as they did for us. This new technology has huge potential to empower creatives in so many different fields, so it would be a worthy use of your time.

The first drop we have open currently (Ones To Watch) has already raised significant income for 16 talented early stage photographic artists, and our next planned drops will be both highlighting work that shines a light on environmental issues, and allocate part of the income generated directly to environmental causes. 

I hope that clarifies our thinking and position on the very important matters you have raised.

All the best,

Marc

Marc Hartog, CEO of 1854 Media


28th October 2021

Dear Marc,

Thank you for your reply.

Ultimately, I’m left feeling that we need to take a step back from the sea of tech talk.

To be clear with you and anybody else reading, I understand that good things come from technology and that new technologies can be explored. However, the deeper I researched, the more appalled I became by the mechanisms that surround cryptocurrencies and the dark connections they’re known to finance.

You and other institutions can swamp us with the new language and tell us about how things will improve over time, but the fact is that we’re facing real world problems right now as a result of this activity — not just environmentally but practically too.

Mark Zuckerberg said, “Move fast and break things. Unless you are breaking stuff, you are not moving fast enough.”

That’s the stage NFTs are at right now — it’s moving fast and things are being broken. Is it really time for The British Journal of Photography to jump on this bandwagon? And is it aligned with your Decade for Change award which you say:

“…explores the many facets of the climate crisis: the strength and fragility of the natural world; the indirect impacts on communities and everyday people, and our global efforts to turn things around.”

NFTs aren’t solving a problem. Best practice is best practice — be it in the real world or online — and is upheld by rules and regulations that have evolved over time. The internet itself is still in its infancy, let alone the world of crypto and NFTs, and the lack of regulations are already destroying lives for the benefit of the few.

Trust in tech is at an all-time low due to lack of transparency and trust is being based on faith — much like a cult or a religion — as opposed to fact. As a very simple example, purchasing an NFT relies on a process of trust that the transaction will be upheld, a trust that we’re already seeing repeatedly being broken for the reasons I described in my blog post.

Your move says nothing for photography, but everything for money. Indeed, your response notably revolved around tech and money yet said little for photography itself.

On the environmental issues, less energy does not mean ‘sustainable’ or ‘eco-friendly’ and I presume you’re planning to sell many NFTs, not as few as possible?

Whichever way you package it, you’re stoking the fire of a trading mechanism that is the child of crypto, not a creation of the art world. From eco-footprint to money laundering, the problems with NFTs stem from the issues that already plague crypto — to use a legal phrase, NFTs are ‘fruit of the poisonous tree’.

They’re a way to fabricate value in an unregulated world of unaccountability, a way to sell things that aren’t things, all within the framework of a brand new way to torture the planet.

I stand by my comments that NFTs are a new way to sell the emperor’s new clothes in the art world.

People may well return to this blog post in years to come to point and scoff at it because all the practical, ethical and environmental issues have been ironed out. In the meantime, there are people suffering along the way, whether through lost/expired/broken NFT transactions or by dying in an illegal coal mine.

For what it’s worth, I really don’t believe this is going to end well at all and I stand by the blog post I published on Sunday.

With best wishes,

Jack Lowe


FURTHER READING

Two articles I discovered a few days after writing this post, which galvanised everything for me, bringing a neat full-stop to a hectic week:

  1. NFTs Weren’t Supposed to End Like This by Anil Dash, co-creator of NFTs
  2. Here is the article you can send to people when they say “But the environmental issues with cryptoart will be solved soon, right?” by Everest Pipkin
  3. Proof of stake is a scam and the people promoting it are scammers from Yanmaani’s Blog
  4. The Case Against Crypto by Martin O’Leary

You might also like to read the blog post I wrote a few days earlier called This is Your NFT Wake-up Call.