When it comes to NFT, you probably immediately think of the most popular blockchains like Ethereum, Solana, BNB or Polygon. However, it is possible that many people have forgotten about Bitcoin, even though digital collectibles have appeared on the network since 2014. Like NFT on other blockchains, Bitcoin NFT is a unique digital asset that is provable and linked to digital (and sometimes physical) content such as digital art, movies, and music.
Although NFT on the Bitcoin network has been around for almost a decade, it seems that not many people are paying attention to it. Recently, a project that allows users to mint NFT on the Bitcoin network called Ordinals has become famous for its rapidly growing user base. This is a breath of fresh air to the Web3 space, becoming one of the most controversial topics in the crypto community in the first half of 2023.
The concept of Bitcoin NFT is not entirely new, but overall the market has changed dramatically from what we knew back in the day. Even before the concept of NFT was born, digital assets could be encrypted and shared through Counterparty, a protocol built on top of the Bitcoin network. One of the collections from that era was Rare Pepes (2016) which was transferred to Ethereum and even the famous rapper Snoop Dogg owned some.
In general, Bitcoin NFT shares all the same characteristics as NFTs on other blockchains such as impossibility and scarcity, but the technology is still in its infancy, especially when compared to Ethereum and Ethereum. Solana, blockchains have had several years to perfect the features of NFT.
Currently, the total number of Bitcoin NFTs is unknown, but data from Dune Analytics indicates tens of thousands of NFTs have been minted via the Ordinals protocol.
Ordinals is a protocol developed by Casey Rodarmor that aims to introduce NFTs into the Bitcoin ecosystem in a more popular way. The platform allows users to discover, transfer, and receive an individual satoshi including unique recorded data such as videos and images. The process of adding assets to individual satoshis is called inscription. Inscriptions help inject digital content into a Bitcoin transaction and assign it to a satoshi – a smaller unit of Bitcoin named after blockchain founder Satoshi Nakamoto. At the same time, the inscriptions are also stored in the signature of the Bitcoin transaction.
Although there has been resistance from staunch Bitcoin supporters, Ordinals continues to thrive, with a total of 128,154 inscriptions made so far. The number of NFTs minted saw the biggest spike on February 9, with more than 21k subscriptions in a single day. The recorded NFT transactions also cost over 37 BTC, approximately $917,740 at the time of writing.
At this time, Ordinals-related NFT transactions are taking up an average of 2.2 MB per day of Bitcoin block space. Most of the criticism against Ordinals today is based on concerns that it will consume resources on the network, causing people in developing countries to pay more to run their Bitcoin nodes. However, developer Rodarmor has asserted that inscriptions have no resource requirements, thereby refuting claims that Ordinals will abuse the Bitcoin protocol or will increase transaction costs.
The NFT project Ordinals has sparked new interest in the NFT space, despite the growing controversies on social media. While not many people currently know about Ordinals, some see it as a potential market to explore, although it comes with higher risk. If you are interested in taking advantage of this opportunity, it is important to understand both the benefits and risks associated with investing in Ordinals.
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You’re probably wondering why are Ordinals so hyped, here’s the answer. Normally, NFTs created on the Ethereum blockchain or an Ethereum Virtual Machine blockchain often refer to off-chain data that is stored on the Interplanetary File System (IPFS), which is a decentralized file storage system that works like the hard drive of the blockchain.
The IPFS data can be updated through dynamic metadata, meaning that some NFT projects can improve the image quality of specific NFTs. To do this, they may prompt the NFT holders to click a “refresh metadata” button on OpenSea to access the updated, higher-quality image.
The ability to update an NFT’s metadata highlights a weakness that Rodarmor aimed to address when he created the new Ordinals protocol. In his view, many NFTs are “incomplete” because they require off-chain data, while Ordinals are “complete” because all data is recorded directly on the blockchain. This is why Rodarmor refers to Ordinals as digital artifacts rather than Bitcoin NFTs. Additionally, NFTs often have creator royalties associated with them, while digital artifacts do not. According to Rodarmor, an Ordinal aims to embody what NFTs should be, what they sometimes are, and what inscriptions always are by their very nature.
The appeal of the Ordinal Punk collection is hard to resist. The collection, which pays tribute to CryptoPunks, consists of only 100 NFTs that were minted within the first 650 inscriptions on the Bitcoin blockchain, with the highest inscription in the collection being #642. The generative collection features 192×192 pixel images created using an open-source algorithm from the pseudonymous Web3 creator FlowStay. Currently, the lowest bid for an Ordinal Punk is 0.14 BTC (nearly $3,400), while the highest asking price is for Ordinal Punk 71 at 100 BTC (approximately $2,447,000).
Taproot Wizards is an Ordinal collection of hand-drawn NFT wizards created by independent Web3 developer Udi Wertheimer. The collection begins with Inscription 652 on the Bitcoin blockchain. The first Ordinal in the collection is said to have set a record on the Bitcoin blockchain for being the largest block and transaction at 4MB. Currently, only a few Taproot Wizards have been inscribed on the Bitcoin blockchain, with the project’s Wizard ID verification page on Discord confirming only six of them: Inscription 1,107, 1,383, 2,637, and 2,625.
The Bitcoin Rocks collection is a tribute to one of the first NFT collectible projects on the Ethereum chain, Ether Rocks. Created by ordrocks, this collection is limited to 100 NFTs, with the first rock minted at Inscription 71. Some NFTs in the collection are listed for as much as 1,000 BTC (over $24 million), while the current floor for bids is at 2 BTC (nearly $48,000).
The concept of Bitcoin NFTs is relatively simple compared to regular NFTs, but the technical operations involved in creating and trading Ordinals can be complex and serve as a barrier for those who want to learn about them. However, to achieve something with Ordinals, you need to be on the cutting edge. It is important to conduct thorough research and due diligence before investing. In the next article, we will guide you in more detail on how to create and buy Ordinals, follow Oxalus Insight to read the latest updates in the Web3 space!
1. What is an inscription?
Inscriptions are digital content that is embedded in the blockchain: for example, text, images, or MP3. Inscribed Satoshis are set as special transactions so that users can identify and track them.
2. What is an NFT in Bitcoin?
Basically, Ordinals are NFTs you can mint directly onto the Bitcoin blockchain, but all data is recorded directly on the blockchain instead of a decentralized file storage system.
3. Where to buy Bitcoin NFT?
Currently, there is no marketplace that supports Bitcoin NFT trading, so Bitcoin NFT trading is done entirely through OTC.
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