Raise your hands if you’re not entirely convinced that non-fungible tokens (NFTs) are about to take over the world.
There is no doubt that the NFT concept has made itself felt. Digital artists have welcomed the technology, which allows them to create one-of-a-kind or limited edition artworks that can be bought and sold and whose provenance is verified on the blockchain. Huge sums changed hands and headlines made headlines. In the less rare world of marketing, brands use so-called utility NFTs to sell tokens and logos, which also provide shoppers with special benefits such as loyalty program memberships or access to events.
The question, of course, is why not just sign clients up to the good old membership schemes? Is there any real benefit to a less than modest NFT? Or, in other words, is there anything uniquely useful about this technology? Ben Whateley thinks it could be. In fact, he set out to demonstrate that NFTs can be a force for good.
Whately got his entrepreneurial teeth in as the co-founder of Memrise, a language app launched in 2010. As director of strategy for the company, he is also the co-founder of Angry Teenagers, a startup launched last November with the goal of doing something to alleviate land degradation. NFTs are at the heart of the way his business operates.
Result of disappointment
Whately says the new company owes its existence, at least in part, to the frustration expressed by his teenage daughter. “She came back from the environmental march and said that everything is fine, but what can we do to really change something,” he recalls.
The comment clearly echoes Whately’s own approach to technology-driven entrepreneurship. He sees technology as a means of turning intentions into actions. “When waves of change occur, entrepreneurs create products that bring about that change,” he says.
But what does this mean in practice? In some sectors, there is a relatively simple line between demand and the desire to do something different and the product. Whately cites Memrise as an example. Like other language apps, its goal was to turn the desire to learn a language into a positive action.
But can the same principle be applied to climate and the environment? Whatley sees the desire of a growing number of people to do something practical to solve environmental problems, but he also finds a sense of helplessness. “What can you do?” he asks rhetorically. “You can eat less or fly less, but what positive actions can you take?”
Well, one could argue that eating and flying less is kind of a positive thing, but Whately was thinking of something more practical. And that brings us to the NFT. Whately’s solution was to create Angry Teenager NFTs that could be bought and sold on the green Tevos blockchain. The proceeds from the purchase of the NFT are being used to plant trees in Ghana, an area that has suffered from significant environmental degradation.
Nuts and bolts
So what is the point of this? So you buy an Angry Teenagers token and in addition to the visuals, your money pays to plant trees in a geolocated square of Earth. As the trees grow, you can track the impact. Ultimately, trees generate money through carbon offsets, and some of that money is reinvested in forestry projects. A certain amount is also returned to the buyer’s wallet, although it is intended for reinvestment.
The token can also be sold, and access to information about the impact passes to the new owner. But is there an incentive for secondary buyers? After all, the investment has already been made by the original owner. Whately says a certain amount of money is released and invested when the token changes hands, so new owners are also helping to make a difference.
All is well and good. But given the growing pressure on the land – and the population of Africa is increasing – will this be a long-term solution, or will the trees just be cut down when commercial pressure arises and someone wants to do something else with the land? Whately says the community has economic incentives. “The planting area includes a certain percentage of fruit trees and beehives,” he says. “We have to make sure there is an economic benefit to the community.” In addition, the land is protected by a 50-year agreement.
So will it work? This should soon become apparent. The groundbreaking work to identify and secure the land has been done, and Whatley hopes the project will raise $100,000 for tree planting by Christmas and have an avalanche of impact over time.
But perhaps the question of the usefulness of NFTs remains. Equally, it should be possible to accept tree planting donations and provide transparent impact reports without the use of NFTs and blockchain. However, there is nothing wrong with using the allure of a trending technology to raise awareness and fund a startup that combines revenue generation with purpose. New low-carbon blockchain platforms are emerging – one of them is Tezos – potentially increasing the appeal.