For more than a decade, bitcoin It used to be a purely digital currency, but today it is expanding its horizons more than ever.
Since 2023, non-fungible tokens (nfts) have arrived on the bitcoin network, known as bitcoin Ordinals – which has opened a new frontier for digital art, collectibles and blockchain culture.
bitcoin ordinals are unique pieces of data that are embedded directly into individual satoshis, the smallest units of bitcoin, and transform them into distinct digital artifacts. What makes bitcoin nfts unique, how do they work, and why should you explore them?
Here is our complete guide to bitcoin ordinals in 2024.
<img decoding="async" class="alignnone size-full wp-image-75792 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1.jpg” alt=”A Complete Guide to bitcoin Ordinals in 2024 – btc” width=”800″ height=”448″/><img decoding="async" class="alignnone size-full wp-image-75792 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1.jpg” alt=”A Complete Guide to bitcoin Ordinals in 2024 – btc” width=”800″ height=”448″ srcset=”https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1.jpg 800w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1-300×168.jpg 300w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1-768×430.jpg 768w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1-370×207.jpg 370w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1-760×426.jpg 760w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image1-270×152.jpg 270w” sizes=”(max-width: 800px) 100vw, 800px”/>
What are bitcoin ordinals?
bitcoin ordinals were introduced in January 2023 by x.com/rodarmor” target=”_blank” rel=”noopener”>Casey Rodarmora prominent bitcoin developer. He used new features in bitcoin’s November 2021 Taproot upgrade (an enhancement to smart contracts) to allow data to be recorded in individual satoshis, without impacting the bitcoin core network, in an effort to create a more fair, equitable, and authentic blockchain art ecosystem.
The rise of Ordinals led to the creation of the BRC-20 standard (a bitcoin asset standard equivalent to ERC-20 for nfts on ethereum), followed by Runes, a more efficient standard for art on bitcoin. This led to existing nft powerhouses experimenting with bridges to bitcoin or new collections on bitcoin, including btc. x.com/DeGodsNFT” target=”_blank” rel=”noopener”>DeGodand TwelveFold from Yuga Labs.
After a brief period where bitcoin Ordinals trading was tracked through a public Google Sheets document, an increasing number of wallets, exchanges, and platforms began supporting bitcoin Ordinals. Some of the most popular bitcoin Ordinals wallets include x.com/XverseApp” target=”_blank” rel=”noopener”>Xverse, x.com/LeatherBTC” target=”_blank” rel=”noopener”>Leatherand OKX Wallet, while larger Ordinals marketplaces include Magic Eden, OKX, and Gamma.
Since then, bitcoin Ordinals has continued to gain importance. x.com/Stacks” target=”_blank” rel=”noopener”>Batteries Ordinals emerged as a dedicated “layer 2 style” network for bitcoin, building its own nft ecosystem within the bitcoin ecosystem. Further improvements are being made to enhance bitcoin Ordinals’ smart contract capabilities as well, as although its popularity continues to grow, Ordinals is still considered a niche segment of the broader nft industry.
<img decoding="async" class="alignnone size-full wp-image-75793 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2.jpg” alt=”Complete Guide to bitcoin Ordinals in 2024 – BRC-20″ width=”800″ height=”448″/><img decoding="async" class="alignnone size-full wp-image-75793 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2.jpg” alt=”Complete Guide to bitcoin Ordinals in 2024 – BRC-20″ width=”800″ height=”448″ srcset=”https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2.jpg 800w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2-300×168.jpg 300w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2-768×430.jpg 768w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2-370×207.jpg 370w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2-760×426.jpg 760w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image2-270×152.jpg 270w” sizes=”(max-width: 800px) 100vw, 800px”/>
How do bitcoin ordinals work?
bitcoin ordinals work slightly differently than nfts on ethereum.
On ethereum, data about an asset is added to a smart contract on the network, and the art itself is typically stored on a decentralized IPFS service like Pinata or x.com/infura_io” target=”_blank” rel=”noopener”>FatIn bitcoin, data is recorded in individual satoshis on the bitcoin network, making Ordinals completely on-chain.
Since each satoshi in bitcoin is mined sequentially, there is a limit to the maximum number of ordinals there can be: approximately 2.1 trillion, and since each individual satoshi exists as normal in bitcoin, they can be bought, sold, and traded in a similar way to nfts on ethereum.
In addition to these differences, Ordinals also have a built-in layer of rarity that ethereum-based nfts do not. Some particular satoshis, regardless of the data inscribed on them, are more desirable than others, such as the first satoshi of a new block, a new epoch, or a new cycle. Rodarmor created the Rodarmor Rarity Index to categorize all satoshis into 6 different rarities, from common to mythic, adding another perceived layer of value to Ordinals.
Ordinals have received mixed reactions from the bitcoin community. Critics argue that they muddy the waters for bitcoin, weakening its position as the leading digital currency and leading to increased network congestion and higher fees. Supporters argue that ordinals expand bitcoin's existing capabilities and open up new avenues for both bitcoin and digital art to succeed.
Despite these debates, the Ordinales have gained steady momentum and look set to continue to do so.
<img decoding="async" class="alignnone size-full wp-image-75794 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3.jpg” alt=”A Complete Guide to bitcoin Ordinals in 2024 – bitcoin nft” width=”800″ height=”448″/><img decoding="async" class="alignnone size-full wp-image-75794 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3.jpg” alt=”A Complete Guide to bitcoin Ordinals in 2024 – bitcoin nft” width=”800″ height=”448″ srcset=”https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3.jpg 800w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3-300×168.jpg 300w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3-768×430.jpg 768w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3-370×207.jpg 370w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3-760×426.jpg 760w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image3-270×152.jpg 270w” sizes=”(max-width: 800px) 100vw, 800px”/>
The History of bitcoin Ordinals
Ordinals are not the first attempt to add additional functionality to bitcoin.
x.com/CounterpartyXCP” target=”_blank” rel=”noopener”>Counterpartwhich debuted in 2014, attempted a more rudimentary approach but faced limitations in scalability, storage capacity, and scripting that led to it falling out of favor.
bitcoin’s Taproot upgrade in November 2021 paved the way for a more effective solution, and in January 2023, Casey Rodarmor introduced the Ordinals protocol to bitcoin.
In March 2023, BRC-20 tokens were introduced, and $ORDI emerged as the first fungible token on bitcoin, surpassing $1 billion just a month later. This success was accompanied by a wave of new Ordinals projects, such as Taproot Wizards, x.com/OrdinalPunks” target=”_blank” rel=”noopener”>Ordinal Punks and x.com/BitcoinFrogs” target=”_blank” rel=”noopener”>bitcoin Frogs – prompting major nft marketplaces like Magic Eden and OKX to add support for Ordinals.
By the end of 2023, over 10 million Ordinales had signed up, and that number only continued to grow throughout 2024, with more tools, platforms, and dedicated enthusiasts than ever before.
<img decoding="async" class="alignnone size-full wp-image-75795 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4.jpg” alt=”A Complete Guide to bitcoin Ordinals in 2024 – TwelveFold” width=”800″ height=”448″/><img decoding="async" class="alignnone size-full wp-image-75795 lazyload" src="https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4.jpg” alt=”A Complete Guide to bitcoin Ordinals in 2024 – TwelveFold” width=”800″ height=”448″ srcset=”https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4.jpg 800w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4-300×168.jpg 300w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4-768×430.jpg 768w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4-370×207.jpg 370w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4-760×426.jpg 760w, https://nftplazas.com/wp-content/uploads/2024/09/bitcoin-ordinals-guide-2024-image4-270×152.jpg 270w” sizes=”(max-width: 800px) 100vw, 800px”/>
What is the future of bitcoin ordinals?
bitcoin Ordinals focuses on several key areas for the future.
Improving the Ordinals protocol directly to address current scalability issues will be critical, including further development of the Stacks L2 ecosystem. Several avenues for further innovation remain open, such as DeFi, tokenized securities, advancements in digital art, and more, and with the ever-changing regulatory environment (particularly in the US), Ordinals could be a key gateway to user adoption in the future.
The popularity of bitcoin Ordinals is an indication of how the bitcoin ecosystem can adapt in light of current trends or consumer habits, and as they continue to develop, Ordinals offer exciting opportunities for artists, collectors and investors alike.
Regardless of whether you are for or against ordinals, their impact only seems destined to grow as time goes on.
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