Bitcoin Ordinal NFTs: The New Kid on the Blockchain
The introduction of Ordinal NFTs, also known as Bitcoin Ordinals, brings a new dimension to this discussion. Let's dive into what Ordinal NFTs are, how they work, and how they differ from other NFTs.
Non-fungible tokens (NFTs) have been at the forefront of the blockchain conversation, largely centered around the Ethereum blockchain. However, the introduction of Ordinal NFTs, also known as Bitcoin Ordinals, brings a new dimension to this discussion. Let's dive into what Ordinal NFTs are, how they work, and how they differ from other NFTs.
What are Ordinal NFTs?
NFTs are most widely known as Ethereum-based tokens, but lately the buzz is all about Bitcoin NFTs, which are also known as Ordinal NFTs or Bitcoin Ordinals. The introduction of something called inscriptions on Bitcoin’s mainnet in January 2023 enabled the creation of Ordinal NFTs, which are basically NFTs on Bitcoin. This novel project has captured the collective mindshare of both NFT lovers and haters.
How do Ordinal NFTs work?
Ordinal NFTs use inscriptions to work. Inscriptions are powered by Ordinal theory through the Ordinal protocol, which was developed by Casey Rodarmor. Ordinal theory aims to give satoshis (the smallest unit of bitcoin at 1/100,000,000 of a full bitcoin) “individual identities allowing them to be tracked, transferred and imbued with meaning.” Basically, the Ordinal protocol assigns each satoshi a sequential number. After that number is assigned, each satoshi can then be inscribed with data such as pictures, text or videos through a Bitcoin transaction. Once that transaction is mined, the arbitrary data is permanently part of the Bitcoin blockchain and viewable through Ordinal-enabled Bitcoin wallets and online Ordinal viewers.
How are Ordinal NFTs different from other NFTs?
The one main difference between Ordinal NFTs and other NFTs has to do with data storage. Most NFTs are created using the Ethereum blockchain through the ERC-721 Non-Fungible Token Standard. When an ERC-721 NFT is created, a file of metadata provides information about the NFT. In the case of the most common NFTs, which are digital art, the actual JPG or file of the art is usually stored off the Ethereum blockchain and the metadata includes a link to that file. This means that the actual file or artwork can be altered since it is not embedded in the blockchain. Bitcoin’s Ordinal NFTs are different in that there isn’t a file of referenceable metadata that describes the NFT; instead, the entire data file resides in the witness signature field of Bitcoin transactions. That means the entirety of Ordinal NFTs live and breathe on the blockchain.
How to mint an Ordinal NFT?
Currently, there are two main ways to mint your own Ordinal NFT. The first way is by starting up a full Bitcoin node and running Ord on the node. Then you can start inscribing satoshis into a wallet you control to make Ordinal NFTs. This method is technically involved and is more suitable for tech-savvy hobbyists and those who really love NFTs. The other way to inscribe an Ordinal NFT is to use a no-code inscription tool. One of these no-code tools is Gamma. It is relatively straightforward for those familiar with Bitcoin, but it can be a bit tricky at parts
Bitcoin Ordinal NFT Examples
These Ordinals are different from traditional NFTs in that the entirety of their data resides directly on the Bitcoin blockchain, without the need for a sidechain or a different blockchain, and without referring to an off-chain metadata file.
Now, here are the two projects:
- Ordinal Punks: This project was mentioned on the Gamma.io platform, which is the largest Bitcoin NFT platform that supports the creation of Bitcoin Ordinals. Ordinal Punks seem to be a collection of NFTs similar in concept to the Ethereum-based Cryptopunks, but are inscribed directly on the Bitcoin blockchain. Unfortunately, I wasn't able to find more specific information about this project as the details about it seem to be scarce online.
- Yachtify: Yachtify is a marketplace for fractional ownership of yachts, represented by NFTs on the blockchain. Although it wasn't explicitly stated that Yachtify uses Bitcoin Ordinals, their approach of tokenizing real-world assets aligns with the use case of Bitcoin Ordinals. On Yachtify, users can buy, sell, and rent real-world yachts, and the yachts can be fractionally owned. When a boat is rented out, the owners earn a portion of the rental based on their overall share.
Bitcoin Ordinal NFT: FAQs
1. What are Bitcoin Ordinals or Ordinal NFTs?
Bitcoin Ordinals, also known as Ordinal NFTs, are non-fungible tokens (NFTs) minted on the Bitcoin blockchain. They use the Ordinal protocol to inscribe data directly onto individual satoshis, the smallest unit of Bitcoin.
2. How are Ordinal NFTs different from traditional Ethereum-based NFTs?
The key difference between Ethereum-based NFTs and Ordinal NFTs is where the data is stored. Ethereum-based NFTs store a reference to the data in a metadata file, which often points to an off-chain location. Ordinal NFTs, however, store the entire data file directly on the Bitcoin blockchain, in the witness signature field of a Bitcoin transaction.
3. How do I mint an Ordinal NFT?
There are two main ways to mint an Ordinal NFT. One is to run a full Bitcoin node and use the Ordinal protocol to inscribe data onto satoshis within a wallet you control. This method requires technical know-how. The other method involves using a no-code tool, which is more user-friendly.
4. What are some use cases for Ordinal NFTs?
While the use cases for Ordinal NFTs are still being explored, they can be used to create unique, immutable digital artifacts. This includes anything from digital art to inscribing meaningful information onto the Bitcoin blockchain.
5. Are inscriptions permanent?
Yes, once data has been inscribed onto a satoshi using the Ordinal protocol, it becomes a permanent part of the Bitcoin blockchain. This ensures the immutability of the inscribed data.
To conclude, Bitcoin Ordinal NFTs present a new and exciting development in the blockchain and NFT space. Through the use of the Ordinal protocol, individuals can create unique and immutable digital artifacts directly on the Bitcoin blockchain, providing a new dimension of possibilities for the application of NFTs.
While still in its early stages, this new type of NFT has already started to gain traction, with practical applications in various sectors. Despite some technical challenges associated with minting these NFTs, tools and platforms like Gamma.io are making the process more accessible to the average user.
It remains to be seen how this technology will evolve and what kind of impact it will have on the wider crypto and blockchain ecosystem. However, given the innovative nature of Ordinal NFTs and the potential they offer, it's safe to say that this is an area worth keeping an eye on. As the technology continues to mature and more use cases are discovered, we may well see Bitcoin Ordinal NFTs play a significant role in the future of digital assets.