Bitcoin-based NFTs and meme tokens are not going away. Quite the contrary, according to publicly available blockchain data compiled by sources, the number of Cardinals inscriptions surpassed 9 million on Thursday, increasing the whole quantity of digital artifacts on the blockchain since May 1, when it was slightly over 3 million.
Ordinals is a protocol for “inscribing” things on the Bitcoin blockchain, such as artwork, profile images, programs, and even playable games. After its January introduction, it swiftly gained popularity as users carved media onto the blockchain. It is the more recent innovation on the top blockchain than the other catalysts.
By writing their information on the smallest unit of Bitcoin, satoshi, they provide a mechanism to store media on the network. Early in 2023, it was created, effectively introducing non-fungible tokens (NFTs) to the biggest network in the sector.
Amid increasing network congestion and transaction costs, some critics still claim that Ordinals is a misuse of the Bitcoin blockchain and should be restricted on the network. However, cryptocurrency supporters, such as MicroStrategy founder Michael Saylor, refer to the protocol as a “catalyst” for adopting Bitcoin.
Saylor stated on the PBD Podcast earlier this month that “every time someone builds an application that’s cool on Bitcoin, like all the Ordinals and inscriptions and whatever are driving up transaction fees, it’s a catalyst.”
At last week’s Bitcoin 2023 conference, Saylor said that MicroStrategy, the publicly traded firm with the largest Bitcoin holding on its balance sheet, is researching using Ordinals to start blockchain-based apps. After the protocol was introduced by Bitcoin engineer Casey Rodamor in January, Bitcoin Ordinals were already a hot topic, though it wasn’t immediately obvious whether the excitement would last in the short term.
Following the implementation of the BRC-20 token standard in March, which enabled the production of fungible tokens on Bitcoin using the same protocol, the popularity of ordinals increased once more. Today, inscriptions for artwork and other forms of media are far outnumbered by the daily text-based inscriptions required to produce BRC-20 tokens.
With the introduction of BRC-20, inventive coders started flooding the Bitcoin network with meme tokens, driving up the cost of network transactions. The daily fees paid to produce Bitcoin Ordinals peaked on May 8 at 257 BTC, which was approximately $6.7 million at the time.
After the number of Ordinals reached 3 million, the founder of Ord.io, who prefers to go by the alias Leonidas, said that rising costs for Bitcoin are actually a very positive thing. It demonstrates a significant demand for Bitcoin’s block space, which is essential to the protocol’s long-term viability.
Markets for NFT have taken note of Ordinals’ growing appeal. Binance introduced support to its marketplace in May after Magic Eden provided support for Ordinals in April. As a result of the porting of Ordinals to Litecoin and Dogecoin, which both have their roots in the Bitcoin source code, the emergence of NFTs and meme tokens has also spread outside of the Bitcoin ecosystem.