A critical professional ethical analysis of Non-Fungible Tokens (NFTs)

Abstract

Non-Fungible Tokens (NFTs) have quickly become an important part of the blockchain economy, theoretically representing ownership of a digital asset registered on a public blockchain such as Ethereum. While several applications of this technology exist, the key underlying factor in NFTs’ success is in their potential for investment – buying, selling, and trading the digital assets such as artwork or video game items using cryptocurrency. The rise and mid-2022 crash of NFT and associated crypto markets have shown the volatility of the sector, and questions have been raised around the sustainability, environmental impact, and exploitative practices within this space – and whether there are, in fact, any possible socially responsible use cases for NFTs. This paper aims to fill a gap in the literature surrounding NFTs, primarily through a thorough ethical analysis of the technology and its implementation, deployment, and sustainability. To do this, it uses the Association of Computing Machinery's Code of Ethics and Professional Conduct as a framework for analysis and, following this analysis, makes some recommendations for those wishing to investigate and/or implement NFTs in an ethically responsible manner. The key message is that unless there is absolutely no other way to solve a problem other than using NFTs, then they should not be implemented, as there is currently no ethical use case or means of implementation of NFTs.