Bitcoin is evolving into a multi-asset network

For over a decade, mainstream narratives around bitcoin (btc) have focused on its role as a peer-to-peer digital cash and store of value.

However, everything indicates that we are witnessing a significant change in this paradigm.

Since early 2023, one of the most discussed topics in the bitcoin ecosystem has been the use of the world’s leading blockchain to store information that goes beyond the use cases mentioned above.

Related: bitcoin Fragments Could Become More Valuable Than Whole Bitcoins

If you’ve been isolated in an igloo this crypto winter and are unaware of developments, here’s a quick overview.

In January 2023, developer Casey Rodamor introduced the world to Ordinals, a protocol that allows any file to be permanently enrolled in the bitcoin blockchain.

This was not the first method created for such an action, but it gained greater traction, creating a trend in which collections of non-fungible tokens (NFTs), music, video games, newspaper articles and even WikiLeaks records began to be stored in an eternal place. and immutable on the world’s largest decentralized network.

‘An anonymous activist group is recording Afghan war records published by WikiLeaks in bitcoin?src=hash&ref_src=twsrc%5Etfw”>#bitcoin to protest the imprisonment of Julian Assange’ @BitcoinMagazine #FreeAssange https://t.co/1huZ6J9SDM

—WikiLeaks (@wikileaks) October 23, 2023

As a result, experiments, innovation, and the outlook for the bitcoin network as a vast decentralized database began to simmer.

Despite being less than a year old, the Ordinals protocol has evolved noticeably to become more efficient and enable bolder use cases.

One of the notable improvements is the recursive inscriptions technique, which allows users to bypass the 4 megabytes per block storage limit, allowing larger data to be inserted into the bitcoin blockchain.

As an example, illustrated by the image below, I inscribed an entire Cointelegraph article about bitcoin using a recursive inscription.

In total, eight registrations were made to achieve the final result, with a total file size of 5.22 kilobytes. (That’s small.) Seven of the inscriptions were images of the item, each stored individually on a Satoshi via the Ordinals protocol. The eighth inscription comprises a code containing the text of the article and issues requests to recover the images of the other Satoshis.

Related: bitcoin has entered a civil war: over ‘art’

This setup allowed the entire article to be eternally inscribed on the bitcoin blockchain, a feat that could not have been accomplished in a single step while maintaining quality.

Leonidas, a developer within the Ordinals community, offered an even deeper perspective on the matter on Twitter, writing:

What happens if many people upload many code packages to the bitcoin Blockchain? So now there is a huge repository of packages that developers can build on. This would unlock powerful use cases that could never be accommodated in less than 4MB. After all, the most complex pieces of software are just a bunch of compiled code. It is now possible to put a complex 3D video game completely on-chain on bitcoin.

WTF are recursive inscriptions?

Here’s everything you need to know:

Earlier this year, the Ordinals Protocol introduced the ability for anyone to enroll fully on-chain files in bitcoin. These inscriptions are autonomous and are unaware of the other files that had been… pic.twitter.com/O3jt6lhaxT

– Leonidas (@LeonidasNFT) June 12, 2023

Only with this can a world of possibilities be contemplated and reinvented. After all, the ability to use the world’s leading blockchain as an immutable, shared, uncensored data store is enormous.

But the innovations don’t end there!

In October, Lightning Labs announced the first launch of Taproot Assets (TARO) on the mainnet, further enhancing the bitcoin blockchain as a multi-asset network.

Announcing the first launch of Taproot Assets on the mainnet, a protocol for assets on bitcoin?src=hash&ref_src=twsrc%5Etfw”>#bitcoin and Lightning.

With this release, developers can issue financial assets on-chain in a scalable way.

Today marks a new era of multi-asset bitcoin. https://t.co/2cNvZSvv8v

– Lightning Laboratories (@lightning) October 18, 2023

This couldn’t have happened at a more opportune time, given the hype around the Ordinals protocol and how it paved the way for TARO to shine alongside it.

The Ordinals Protocol has broadened the perspective of users and builders, allowing them to build and view bitcoin as a multi-asset network.

Ordinals assets flooding the network with transactions forced Binance to implement an integration with Lightning. This key factor, combined with the network’s low costs, decentralization, and high settlement speed, makes trading other currencies and assets very attractive through Taproot Assets.

And among the various applications of the TARO protocol, one of the most mentioned is the ability to issue stablecoins on the bitcoin blockchain.

The paradigm shift is monumental as it paves the way for bitcoin to move from being primarily an exchangeable asset to becoming the medium through which exchanges occur.

This innovation will allow builders to import successful use cases from other chains and bring them back to the mothership.

Some even joke that all other chains are just bitcoin testnets. Does all this lead to bitcoin?

THE bitcoin REBIRTH CANNOT BE STOPPED

the magicians in @lightning labs are back with an efficient protocol for tokens other than bitcoin

ethereum was a testnet. come in soon let’s go to the moon pic.twitter.com/2g6vPFBAbV

-Udi Wertheimer (@udiWertheimer) May 16, 2023

Overall, we could say that we are on the verge of a new era of bitcoin: the era of the multi-asset orange network.

In addition to attracting and retaining more developers who may be interested in these new protocols, these new applications also have the potential to attract and retain new users who initially found no interest or value in bitcoin as a store of value.

For some, transforming the world can sometimes happen through the simple enjoyment of some fun, encrypted sports cards. But with the optimization of the Ordinals, the number of possibilities will continue to expand.

Hal Finney, a prominent cypherpunk (and the first person to receive a transaction from bitcoin creator Satoshi Nakamoto), wrote in a 1993 post on Compuserve: “Thinking a little more about the idea of ​​buying and selling digital cash, I thought about a way to present it. “We are buying and selling crypto trading cards.”

Finney knew it and now you know it too.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.