The BitcoinNFT protocol Ordinals is booming again. Inscriptions traded through Ordinals on Sunday totaled more than 307,000, according to the Dune dashboard, the largest single-day trade volume ever and 16% higher than Saturday's record. As a result, bitcoin network transaction volumes surged, with Sunday's bitcoin transaction volume soaring to more than 568,300 transactions, nearly 78,000 transactions higher than the peak of the 2017 bull market peak, setting a ATH, and Ordinals contributed 54% of bitcoin's daily transaction volume. %, also set a ATH.
Ordinals, which debuted in January, allow data such as audio, art and even video games to be attached (or "burned") onto individual satoshis (satoshis), BTC 's smallest unit.
Inscriptions are sometimes colloquially referred to as Bitcoin NFTs, but the process of creating an inscription and how each corresponding data is stored is different compared to digital assets created on blockchains such as Ethereum or Solana . NFTs are unique digital tokens minted using smart contracts where people can interact with code running on a decentralized protocol. They represent ownership of an item, usually digital art, and while assets such as images can be stored on-chain using Ethereum or Solana, most NFTs point to assets stored off-chain.
For Ordinals, instead of using Ordinals to create entirely new tokens, people inscribe things like images or text on a single Satoshi , which is permanently stored directly on Bitcoin's blockchain.
The latest craze has moved from images to text, with more than 99.8% of the weekend's minted totals being text-based, with images making up just 0.1% of the daily total.
Glassnode has observed that the proportion of the total block size associated with inscriptions has been declining, with analysts saying: “This is due to the growing popularity of text-based inscriptions, which have a significantly smaller data footprint than image inscriptions.”
Unlocking Bitcoin's New Potential?
Ordinals has drawn more attention to Bitcoin, which could help boost its reputation and popularity, according to a recent report from asset management firm Grayscale . Grayscale noted that Ordinals represent one of the larger opportunities for Bitcoin adoption.
The firm believes that Ordinals provide two key benefits to the growth and development of the Bitcoin ecosystem. The first is a substantial increase in fees paid to miners , which could establish a sustainable baseline level of transaction fees to incentivize miners, thereby ensuring "continuous network security throughout the lifetime of the Bitcoin network." On the other hand, the adoption speed of Ordinals and NFTs can also attract new Bitcoin users and inspire more development of the Bitcoin network, promoting a development-oriented community and culture to support the Bitcoin network.
“While there are legitimate concerns, we believe Ordinals has the potential to positively impact the Bitcoin network in the long-term, attracting a new wave of enthusiastic users and developers to embrace the Bitcoin community,” the report stated.
Earlier in February, a study by Matixport showed that NFT could help push the market value of BTC layer2 network Stacks tokens to one billion dollars. Since then, S TX's market capitalization has crossed the $1 billion mark before falling to its current value of $993.38 million.
dispute
Some Bitcoin advocates see Ordinals as a waste of block space because they make transactions more expensive for ordinary users. According to them, the BTC network should only be used for payments.
Among the critics is Blockstream CEO Adam Back , who slammed Ordinals as "useless" and said he "prefers bitcoin as a currency."
Isabel Foxen Duke, director of communications for the Ordinals project, also sounded the alarm, tweeting: "Exciting to see inscriptions (inscriptions) growing in this way, I worry that these numbers are inflated by the BRC-20 tokens generated by a large number of inscriptions , these tokens are highly insecure and may pose a risk to retail investors.”
In fact, some imitation projects have already had problems, such as UniSat Wallet, the digital wallet project supporting inscriptions and BRC-20 tokens. Shortly after launching its own market, its service was compromised "due to a vulnerability in the code base", UniSat Wallet officially stated that it will compensate users affected by the incident, which is said to have affected 70 transactions.
While industry players remain divided on whether ordinals are a good fit for the bitcoin ecosystem, Galaxy Digital 's research arm predicted in March that given the rapidly rising interest in bitcoin NFTs, money market infrastructure, and taking some of the market away from ethereum share, by March 2025, the nascent Bitcoin NFT market will reach a market cap of $4.5 billion. Even in a bear market scenario where Bitcoin NFTs are unable to enter the mainstream NFT market and take market share from Ethereum, Galaxy estimates that based on current interest levels and supporting infrastructure, Bitcoin NFTs could still reach a market cap of $1.5 billion.
Author: BitpushNews Mary Liu
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