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In this video, I discuss “ordinals,” which is a new protocol that allows you to number individual sats and inscribe them with text or images, thus creating actual NFTs on the Bitcoin blockchain itself.
There are 2 strong traditions in Bitcoin culture:
1) Don’t shovel unrelated crap into the Bitcoin blockchain: keep the blockchain as small as possible to make it easier for everyone in the world to run a node, which helps to keep Bitcoin decentralized.
2) Allow everyone to use Bitcoin as they see fit: it’s an open and permission-less system
The advent of NFTs and other inscriptions on Bitcoin provides an interesting battleground for these competing traditions.
Thanks to the November 2021 Taproot soft fork, it is now possible to put NFTs and other pictures or text directly on the Bitcoin blockchain, using inscriptions and ordinals.
Ordinals allows us to organize sats into a particular order and thus identify individual sats. These sats can then be “inscribed” with actual text or pictures and sent around the Bitcoin network.
Inscriptions have the potential to contribute to blockchain bloat, as well as mempool crowding and driving up transaction fees.
In addition, if bad images like child porn are inscribed on the Bitcoin blockchain, governments could use this as an excuse to jail otherwise innocent Bitcoiners who are running full nodes.
Bitcoin is open to everyone and permission-less.
That being said, if you believe in Bitcoin’s fundamental global mission to provide neutral money to 8 billion, you probably won’t be putting any of your own inscriptions on the chain and contributing to blockchain bloat.
My guess is that people who want to store NFTs and other inscriptions on Bitcoin will eventually be priced out by Bitcoin’s better financial uses, including as a global final settlement layer.
Not investment advice! Consult a financial advisor.
2010 debate about adding extra stuff to the Bitcoin blockchain:
https://bitcointalk.org/index.php?topic=2137
https://en.bitcoin.it/wiki/BitDNS
https://bitcointalk.org/index.php?topic=1790.220
https://bitcointalk.org/index.php?topic=1790.msg28917#msg28917
How Bitcoin Destroys All Altcoins (Taro):
Ordinals and inscriptions are here:
Inscriptions are finally ready for Bitcoin mainnet.
Inscriptions are like NFTs, but are true digital artifacts: decentralized, immutable, always on-chain, and native to Bitcoin. 🧵https://t.co/a4dK7zdITS
— Casey (@rodarmor) January 20, 2023
https://decrypt.co/120250/ordinals-launches-nfts-on-bitcoin-triggers-controversy
Inscriptions contribute to blockchain bloat and drive up transaction fees:
Marginalized peoples in developing countries will have to pay more to run their Bitcoin nodes and send transactions because privileged wealthy whites want to put JPEG drawings on the blockchain as status symbols. Just because you can doesn’t mean you should.
— Bitcoin is Saving (@BitcoinIsSaving) January 29, 2023
Ordinal theory handbook:
https://docs.ordinals.com/introduction.html
Ordinals:
https://ordinals.com/
I am not being paid or otherwise compensated by any company or cryptocurrency project that I mention in my videos.
My opinion is not for sale. Please do not contact me with any affiliate or advertising deals.
#bitcoin
#ordinals
#nft
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