The bitcoin bro’s are experimenting with Bitcoin NFT’s via the lightning network and its off to a hot start.
The recent surge in interest in non-fungible tokens (NFTs) has led to an explosion in the creation and sale of digital art and collectibles. However, the high fees and energy consumption of the Ethereum network have left many artists and collectors looking for alternative blockchain solutions. Bitcoin Ordinals are one such solution, offering a way to create NFTs directly on the Bitcoin blockchain.
What Are Bitcoin Ordinals?
Bitcoin Ordinals are a protocol that allows users to embed data, such as images, directly onto the Bitcoin blockchain. This means that NFTs can be created and traded on the Bitcoin network without the need for a separate blockchain. Ordinals use the OP_RETURN opcode, a script in Bitcoin’s programming language that allows for the inclusion of additional data within a transaction.
Since the launch of the protocol in January 2023, users have inscribed more than 100,000 pieces of data onto the Bitcoin blockchain using Ordinals. These inscriptions include a wide array of digital media, such as pictures, audio files, and PDFs. The protocol has been rapidly adopted by a diverse range of users, including artists and businesses.
How Do Ordinals Benefit Bitcoin Miners?
Ordinals provide several benefits for Bitcoin miners. First, they allow for the creation of new transactions, which increases the demand for block space and, in turn, increases the transaction fees that miners can earn. Second, inscribed data is stored directly on the Bitcoin blockchain, increasing the size of the blockchain and, in turn, the storage requirements for nodes. This benefits miners by increasing the value of the Bitcoin network and the resources required to participate in it.
Ordinals have also created new opportunities for miners to earn income. In addition to transaction fees, miners can earn income from the creation and sale of NFTs. This is because each inscription on the Bitcoin blockchain using the Ordinals protocol is unique and can be sold as an NFT. The growing popularity of NFTs has led to increased demand for unique and collectible digital media, which could create new revenue streams for miners.
How Are Ordinals Changing the Game for NFTs?
Ordinals are changing the game for NFTs in several ways. First, they offer a more sustainable and cost-effective alternative to the energy-intensive Ethereum network. Second, they allow for the creation of NFTs directly on the Bitcoin network, inheriting all of the qualities that make Bitcoin the leading Layer 1 blockchain, including its security, decentralization, and network effects. This could lead to a convergence of the NFT and Bitcoin communities, creating new opportunities for artists, collectors, and miners alike.
Prominent projects on Ordinals include Bitcoin Shrooms, Astral Babes, and Bitcoin Punks, which are Bitcoin-based uploads of the original Ethereum CryptoPunks. One of these has sold for as much as 9.5 BTC, or approximately $215,000 at the time of writing. The inscriptions can be explored via the inscriptions explorer, and a full write-up on the technical ins-and-outs of the protocol can be found on the Ordinals GitHub page.
Bitcoin Ordinals are a promising solution for the creation and trading of NFTs on the Bitcoin network. By providing a more sustainable and cost-effective alternative to the Ethereum network, Ordinals could open up new opportunities for artists, collectors, and miners. The growing popularity of NFTs and the promise of a direct integration with Bitcoin could lead to a convergence of the NFT and Bitcoin communities, creating new and exciting possibilities for the future of digital art and collectibles.