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Ordinals push the limits of what can be achieved on the Bitcoin blockchain
Launched on the Mainnet by acclaimed developer Casey Rodarmor in January 2023, Ordinals represents a revolutionary approach to creating token economies on the Bitcoin network: data such as text, images, videos, and more are added or “inscribed” onto a Satoshi, which exists as a digital artifact on the blockchain. Ordinal inscriptions do not require smart contracts to function, thus offering users unparalleled flexibility in token creation by inscribing arbitrary data into the Bitcoin blockchain and encoding it into the witness field of transactions. It is a more secure and permissionless way to create NFTs, which can be transferred/sold to another party via online platforms or marketplaces that support NFT trading.
The adoption of Order them could save Bitcoin from becoming irrelevant, mainly now considered an old technology and in danger of being replaced by quantum computers. Its path to success is not predetermined but shaped by the choices made along the way, which basically means that Bitcoin must gradually change to address long-standing problems (e.g., scalability and security) to remain popular among investors in the next decade. The latest innovation in the Bitcoin family has increased users (or market volume) and social engagement, and many are convinced that Ordinals will help save Bitcoin’s security budget by ensuring that there will always be miners.
What is the difference between Bitcoin ordinals and Ethereum NFTs?
Each Ordinal, in its most basic form, is a Satoshi that has been assigned a unique number, so it is nothing like an NFT hosted on an alternative blockchain like Ethereum, which functions as proof of ownership of its unique metadata. The creators of Ordinals do not receive royalties because they operate on a decentralized model, and while this may seem like a disadvantage, it depends on how you look at it: on-chain royalties often lead to confusion and chaos because payment cannot be enforced without complex/invasive restrictions. Ordinal entries are immutable, so they cannot be changed once minted.
Phrases like “NFT Ordinals” and “Bitcoin NFT” are used all the time in discussions about digital assets, but it should be noted that Ordinal Inscriptions and Ethereum NFTs are distinct in nature, even though there are similarities between the two, so we should refrain from using labels. Digital assets may soon fall under New Jersey rules as Lawmakers discuss blockchain technology. Some digital art and sports cards could be exempted from the bill as long as they are not used for investment purposes, in other words, there are no financial concerns. Several other digital asset laws are awaiting approval by the state governor.
Bitcoin Ordinals Use Cases: How Ordinals Impact the Bitcoin Ecosystem
The list of potential use cases for Bitcoin Ordinals is long and wide-ranging, most of which have yet to see widespread adoption. If you’re curious to learn more, read on:
Digital art
The Ordinal protocol allows you to inscribe art on the Bitcoin blockchain and make your work collectible, balancing the excitement of innovation with the practicalities of security, display, and ease of transactions. Bitcoin is the perfect medium to house culturally and historically significant artifacts and serves as a canvas for digital artists and collectors. Taproot Wizards is an early generative art project, based on the Bitcoin Wizard meme posted by an unknown Redditor in 2013, and each item in the collection of 2,121 Taproot Wizards has its own attributes and designs.
On-chain token issuance
Casey Rodarmor’s Ordinal Theory is an exciting new way to create NFTs on the Bitcoin network that can be easily traded on decentralized marketplaces. The process involves creating an ordinal inscription to mint a distinct digital asset that you can seamlessly move to another wallet or Taproot address, so there’s no need for specialized technical skills or ongoing support. Despite the lack of smart contract functionality, the unique, non-fungible tokens can interact with other blockchain networks, simplifying cross-chain communication and functionality. As an experimental idea, the future of Bitcoin NFTs is uncertain.
Bitcoin Collectibles
Bitcoin collectibles are very similar to standard collectibles, but they do not have a physical presence: they are created, encrypted, and stored on the blockchain. You will come across collectibles in the form of Uncommon, Rare and Legendary Satoshis in the Ordinals market that has led to active speculation and trading, with the most sought-after items worth hundreds of thousands of dollars. Let’s take a closer look at the SATS that Casey Rodarmor considers exceptional:
- Uncommon SATs: The first SAT of each block is labeled as uncommon. Every 10 minutes, a new block of transactions is added to the blockchain, so the SAT marks the beginning of the time period.
- Rare SATS: As the name suggests, rare SATS have special characteristics or are traded as part of famous transactions, valued as collectibles. There can only be 3,437 rare SATS.
- Legendary SATS: These are the first SATS mined after every sixth Bitcoin halving event. Something magical happens roughly every 24 years when halving and mining difficulty coincide.
Online games
Nowadays, you can launch an Ordinals game on Bitcoin with a team of experienced developers thanks to recursive subscriptions, which allow you to use Satoshi’s canvas as a coding playground. So far, multiple games have been subscribed to the Bitcoin blockchain to ensure an accessible and immutable version of online interaction, such as Tetris, Black Hole Square, Ordinal Hangman, and Maze, to name a few. With Bitcoin Ordinals, you can create fun and fair gameplay that keeps players coming back for more rewards.
Final considerations
In summary, Bitcoin Ordinals pave the way for long-term success, managing to unleash a wave of interest in Bitcoin project development and contributing to a more secure and immutable NFT ecosystem. Over the past two years, the Bitcoin community has rejected everything that is happening in the cryptocurrency landscape, so it is no longer interested in trying new things. That is why Bitcoin needs to break the status quo: to bring real change and motivate interest in innovation on the blockchain, whose narrative has evolved over time. The landscape of Ordinals is evolving through improved wallet and marketplace infrastructure, not to mention improvements that enable scalability.