In the world of blockchain, there has been a recent renewed interest in NFT collections. This new wave, however, distinguishes itself from previous ones by shifting its focus to Bitcoin.
Thanks to two crucial evolutions of the Bitcoin protocol – Segregated Witness (SegWit) in 2017 and Taproot in 2021 – it is now possible to easily generate digital artifacts directly on the Bitcoin blockchain, creating what is known as “Bitcoin Ordinals.” This protocol is constantly evolving and will lead to the creation, following the halving, of a new standard called Runes, which will optimize the ecosystem of ordinals and memecoins on Bitcoin.
But what exactly are these Bitcoin Ordinals? Essentially, they represent a way to create inscriptions directly on the Bitcoin blockchain, linking digital information such as images and videos to individual satoshis on the network. This sets them apart from traditional NFTs on Ethereum/Solana, as all Ordinals data is inscribed directly on the blockchain, ensuring greater security and traceability (an option also possible for other chains but requiring additional procedures and protocols). These differences are quite significant, so much so that it is technically incorrect to call these inscriptions non-fungible tokens (NFTs).
The fundamental aspect of Ordinals is the creation of a unique inscription for each satoshi on the Bitcoin blockchain, thus providing a sort of unique identifier for every fragment of data. Ordinals offer significant advantages, such as their full compatibility with Bitcoin and the absence of additional layers or external complexity.
The main difference between Ordinals and traditional NFTs lies in the fact that Ordinals are native assets of the Bitcoin blockchain, while traditional NFTs often operate on separate layers. This makes them easier to create and manage, but potentially less flexible. The future of Ordinals is still in development, with further developments and use cases evolving. Thanks to the solidity of the Bitcoin blockchain and its immutable nature, Ordinals could become a particularly censorship-resistant form of content, with possibilities for expanding supported media. Moreover, Ordinals are also standing out as a means of collecting both from an artistic and technological perspective, in search of rare or specific-characteristic Bitcoin sats that bring luster to the inscriptions.
The Ordinals market has rapidly made a big impact in the NFT ecosystem, gaining and consolidating the top spot for sales volumes, with about half a billion dollars in sales just in the last month. Among the main collections, we mention NodeMonkeys, Bitcoin Puppets, and Ordinal Maxi Biz.