Bitcoin

Bitcoin non-fungible tokens (NFTs) have called quite the stir in the crypto community, but even more so among the Bitcoin community itself.Launched on 21 January 2023 by Bitcoin Core contributor and software engineer <a href="https://rodarmor.com/blog/inscribing-mainnet/" rel="noopener noreferrer nofollow">Casey Rodarmor</a>, the new <a href="https://www.blockhead.co/2023/02/08/bitcoin-ordinals-are-disrupting-nfts-but-heres-why-bitcoin-maxis-hate-it/ordinals.com" rel="noopener noreferrer nofollow">Ordinals</a> protocol built on the Bitcoin mainnet allows digital media to be inscribed on the Bitcoin blockchain, effectively allowing for NFTs on Bitcoin.<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/cc6779a61e5b400986fe565ef6f29dc1.png">100 million satoshis (sats) make up 1 bitcoin. Ordinals allow the user to order and label each individual sat. Inscriptions allow for attaching digital assets such as JPEGs, texts and even video games to each sat.Unlike Ethereum based NFTs, Ordinals allows users to store all the data to a Bitcoin NFT such as full songs, videos and apps up to the full size of a Bitcoin block.Read more: <a href="https://www.blockhead.co/2023/02/08/blocksmith-says-bitcoin-headed-down/" rel="noopener noreferrer nofollow">Blocksmith Says: Bitcoin Headed Down</a>Regular NFTs as we know them can only store a link that then points to a webpage where the image or other digital media is hosted. If this site is pulled down, the asset is gone. By storing the asset directly on the Bitcoin blockchain, Ordinals offers a far superior and more decentralised form of NFTs.<h2 id="header-0">Pro Bitcoin NFT</h2>With more than <a href="https://dune.com/dataalways/ordinals" rel="noopener noreferrer nofollow">11,000 NFTs</a> being minted via Ordinals, with a daily mint of over 3,300 NFTs, the new protocol is rapidly gaining traction.Bitcoin bull Dan Held highlights how Ordinals can "bring more financial use cases to Bitcoin" whilst driving "more demand for block space (aka fees)".<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/9628cb0e450040789a1f17d03ce0869f.png">The O Show host Wendy O <a href="https://www.youtube.com/watch?v=htUDzydlJk8" rel="noopener noreferrer nofollow">says</a> that one of the greatest things about Bitcoin is "giving power back to the people" and that "there are Bitcoiners that do art, so why shouldn't they be able to reap the same benefits [of Ethereum artists]?""Any type of creative industry it is overrun by record labels and art galleries and these predatory third parties," she continues. "So if Bitcoin can help fix that, why wouldn't we want this to thrive?"<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/9b5f305d886d48c7ba3708c221f288a9.png">CoinDesk's contributing editor-at-large Zach Seward added that Ordinals as a "win for Bitcoin" as it could "bring more functionality to the Bitcoin blockchain" and more interest through "all sorts of new activity that otherwise would be migrated to Ethereum."<h2 id="header-1">Not so NFT friendly</h2>Not all Bitcoin bulls are in favour of the blockchain's latest development."The Ordinals block explorer should be browsed with caution, IMO," tweets Pledditor. "It has auto executing, unvetted pieces of JS code executing in your browser that possibly could be malware. Seems like a minefield you should probably avoid."<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/6dc63a171555449986672b22e4ec1a34.png"><img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/cc9f356daaf64265bb0fbbe00aec9477.png">The Hash co-host Jennifer Sanasie explains that the anti-Ordinals believe that the development is "not part of Satoshi's vision.""It's not a peer to peer transaction, it's a silly NFT," she says, presenting the Bitcoin maxi view. However, Sanasie does concede that when going through the arguments against Ordinals, she thought "isn't that the beauty of decentralization, that one person Satoshi or one group of people can actually make this decision and if people want to use this and and want to have it they can?"Another area of contention is Bitcoin's transaction fees, which have been rising along with Bitcoin NFT mints.As of 3 February, the average Bitcoin <a href="https://ycharts.com/indicators/bitcoin_average_transaction_fee" rel="noopener noreferrer nofollow">transaction fee</a> was $1.84, the highest since November 2022.Read more: <a href="https://www.blockhead.co/2023/02/07/more-crypto-regulation-on-the-cards-in-south-korea/" rel="noopener noreferrer nofollow">More Crypto Regulation on the Cards in South Korea</a>“Ordinal NFTs are contributing to the rise in transaction fees we’ve seen this week.” <a href="https://www.businesstimes.com.sg/companies-markets/bitcoin-nfts-push-transaction-fees-blockchain-highest-over-year" rel="noopener noreferrer nofollow">said</a> Colin Harper, head of content and research at crypto-mining services firm Luxor Technologies. “Transaction fees wouldn’t be as high as they are currently if it weren’t for the sudden influx of Ordinal NFT transactions”.Maxis argue that the rise in fees could be detrimental to Bitcoin's ethos. "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," writes one pro-Bitcoin tweeter.<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/31ccd5510d1d42c6996813b15fbf72b0.png">Others regard Ordinals a "spam attack" that needs to be patched. "Bitcoin is experiencing a spam attack, blocks are filling up fast with internet goods including jpegs. This development has been enabled by segwit, a soft fork that inflates the maximum block size of 1mb to 4mb. What is the path forward? Ban or Approve?" Said one angry tweeter.Bitcoin hodler, miner and node runner Derek Ross simply tweeted, "Ordinals are an attack on #Bitcoin. It's being orchestrated by known bad actors."<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/c7807d3f555042c98d4a9c58463451d8.png">Alex de Vries, a long-time Bitcoin cynic and purported environmentalist, further argues that Ordinals have a drastic environmental impact."The carbon footprint of NFTs on Ethereum wasn’t looking great before The Merge, but it was nothing compared to the latest hype: on-chain Bitcoin NFTs," he writes on <a href="https://www.linkedin.com/feed/update/urn:li:activity:7026932617614622720/" rel="noopener noreferrer nofollow">LinkedIn</a>, adding that Bitcoin mining company Luxor mined the largest block ever, which had a carbon footprint equivalent to "the per passenger carbon footprint of taking a flight from New York to Tokyo and back - 466 times."<img src="https://academy-public.coinmarketcap.com/srd-optimized-uploads/8843a8bb8c2f485c9493e2d3097c45bb.png"><h2 id="header-2">Maxi backlash</h2>Bitcoin maxis appear to be losing the debate. Crypto advocate Udi Wertheimer tweeted, “Bitcoin maximalists aren’t real bitcoiners. Real bitcoiners are a happy bunch that likes to have fun. Hal Finney, for example, would have loved the [Taproot Wizards] Bitcoin NFTs. Let’s make bitcoin fun again.”Wendy O pointed out that "Bitcoin maximalists always say that anything other than Bitcoin is an S coin? It's not good, it's scams, etc. So the fact that people are actually able to utilize NFTs which provide a real use case, on Bitcoin, wouldn't this be a good thing for Bitcoin?"Seward also slammed anti-Ordinal Bitcoin maxis as being like an "old man who shouts at the cloud" and that "NFTs being fun is a good argument."Rodarmor also told <a href="https://decrypt.co/120573/bitcoin-nft-mints-rising-transaction-fees" rel="noopener noreferrer nofollow">Decrypt</a> that Bitcoin blocks need to be full to give users a reason to pay more than the minimum fee.“If blocks are not full, then nobody has any reason to pay more than the minimum fee rate to have their transactions included in a block,” he said. “So as a result, blocks must be full."Image credit: Jason Leung on Unsplash / BlockheadFor more insights, visit <a rel="noopener noreferrer nofollow">blockhead.co.</a>

Bitcoin Ordinals Are Disrupting NFTs But Here's Why Bitcoin Maxis Hate It

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