What Are Bitcoin Ordinals? An NFT Alternative for the BTC BlockchainFeb 28, 2023, 5:32PM
The Bitcoin community has introduced Ordinals — a means of embedding images and media on the blockchain.
Bitcoin now supports a feature called Ordinals, allowing users to publish on-chain media in a way that is comparable to non-fungible tokens or NFTs.
What Are Ordinals?
Ordinals are a method of embedding images and media on the Bitcoin blockchain.
Ordinals were made possible by an upgrade to Bitcoin called Taproot, which was introduced in 2021. However, Ordinals did not enter use until blockchain developer Casey Rodarmor launched ordinal inscriptions in January 2023.
This addition allows users to create inscribe satoshis — the smallest unit of Bitcoin — with content such as images, text, or HTML code.
How Are Ordinals Different from NFTs?
Ordinals are much like non-fungible tokens (NFTs) in that they contain media. However, they are different in one important way: all Ordinal data is stored on-chain.
By contrast, traditional NFTs on Ethereum and other blockchains typically contain a link to media that is stored elsewhere — either on a decentralized service like IPFS or on a centralized service such as a web host or data server.
This means that Ordinals should be as permanent and resistant to data loss as Bitcoin itself, whereas NFTs could lose their linked media if a service failure occurs.
Are Ordinals Energy-Intensive?
Ethereum and many other blockchains have transitioned to staking, meaning that NFT transactions no longer require large amounts of energy.
Bitcoin, however, still relies on the energy-intensive process of crypto mining. As such, Ordinal transactions are as demanding as similar Bitcoin transactions.
Though Bitcoin will not end its reliance on mining, steps can be taken to ensure that mining is carried in a sustainable way. In fact, about 60% of Bitcoin mining is currently performed with renewable energy, according to some recent estimates.
Where Can You Browse Ordinals?
Ordinals can be viewed at Ordinals.com. As of Feb. 26, more than 194,000 Bitcoin Ordinals existed, according to data from Dune Research.
One of the most popular Ordinal collections is Taproot Wizards, a series of 2,099 wizards drawn in an "MS Paint" style. These are often used in profile pictures (PFPs).
Litecoin, which is closely based on Bitcoin’s code, also supports Ordinals. As of Feb. 25, there were 38,000 Ordinals on the Litecoin network.
How Can You Buy or Create Ordinals?
You can buy Ordinals with a compatible Bitcoin wallet — namely the Sparrow wallet. There are very specific steps that users must take to avoid loss of funds.
Furthermore, to sell or create Ordinals, users should run a Bitcoin full node.
Though there are currently no major marketplaces on which users can buy Ordinals, this is expected in the future. New users may prefer to wait for such a marketplace to arrive, which will greatly simplify the process of Ordinal trading.
Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.