Bitcoin users have registered over 10 million inscriptions into the Bitcoin blockchain using the newly popular Ordinals protocol.
The milestone comes shortly after Ordinals founder Casey Rordamor stepped down as the project’s lead maintainer on Saturday.
Ordinals’ Blistering Growth
According to data from Dune Analytics, Bitcoin sports exactly 10,018,046 Ordinals inscriptions at writing time – the vast majority of which were recorded over the past month alone.
An inscription refers to data embedded into a Bitcoin transaction’s witness data. Inscriptions have always been possible on Bitcoin, but Ordinals allows users to inscribe data into a single identifiable satoshi, opening up a range of potential applications.
When Ordinals inscriptions first gained traction in February, their primary use case was for producing non-fungible tokens (NFTs). This has already turned Bitcoin into the second most popular network for trading NFTs next to Ethereum, according to CryptoSlam.
However, Ordinals inscriptions ramped up in April as users started leveraging the technology to issue fungible crypto tokens, through the experimental BRC-20 token standard. The standard was highly popular for issuing memecoins at first, but is now used to host the first Bitcoin-based stablecoin Stably USD (USD).
After its unveiling in early March, BRC-20 triggered an avalanche of new inscriptions beginning in late April, and peaking in early May. The transition in Ordinals’ dominance from NFTs to BRC-20 tokens is visible on the blockchain, through the takeover of text-based inscriptions over image-based ones at that time.
Roaring Inscriptions and Fees
As of April 20, Ordinals inscriptions totaled 1,193,102, per data from Dune. That number more than tripled by May 5 to 3,776,366, at which time daily transaction fees generated by related transactions skyrocketed. To this day, Ordinals has netted Bitcoin miners an additional $44 million in fees, and 91% of inscriptions have been text-based.
Certain Bitcoiners like Blockstream CEO Adam Back have objected to Ordinals ‘clogging’ Bitcoin’s blockchain by making transfers more expensive for those using the for its intended purpose. On the other hand, billionaire Bitcoin investor Michael Saylor sees Ordinals as a potential foundation of future innovation, including trading digital securities on Bitcoin.
Ordinals proponents were quick to celebrate the protocol’s milestone on Monday. Dan Held – former Product Manager at Kraken – said on Twitter that he’s confident Ordinals is more than just a fad.
I’ve been in Bitcoin since 2012 and haven’t seen this much excitement almost ever.
I’ll take the other side of that bet. Any qualitative reasons why you feel that way or just Fudding bc you don’t personally like it?
— Dan Held 🧙♂️ (@danheld) May 29, 2023
Ordinals founder Casey Rodarmor handed lead maintainer status to @raphjaph on Twitter on Saturday, saying he hasn’t been “able to give [Ordinals] the attention it deserves.