Bitcoin Ordinals Inscriptions
The Bitcoin Ordinals and Taproot Assets protocols open up new possibilities for Bitcoin, including on-chain articles and stablecoins on the Bitcoin blockchain.
Bitcoin Ordinals transactions were launched in the first quarter of last year and accounted for approximately 40% of all Bitcoin transactions. According to Dune Analytics, Total Inscriptions to date is 36,149,107. On 28 October, daily Inscriptions were 99,283, close to 100,000.
Since the beginning of 2023, one of the most discussed topics in the Bitcoin ecosystem has been the use of the world’s leading blockchain to store information beyond the aforementioned use cases. Despite being less than a year old, the protocol has evolved remarkably to enable more efficient and audacious use cases.
The rise of the Bitcoin Audience protocol
In January 2023, developer Casey Rodamore introduced the world to the Bitcoin Ordinals protocol, which allows users to permanently inscribe files on the bitcoin blockchain.
Art-based, non-fungible tokens are the first prominent use case. However, it has been observed that there are many more potential use cases in the future. While it wasn’t the first method created for this task, it has gained the most traction, creating a trend where people start to store non-fungible token (NFT) collections, music, video games, journalistic articles and even Wikileaks records in a permanent and immutable way on the world’s largest decentralised network.
This has brought the idea of the bitcoin network as a decentralised database to a boil, and one of the most notable improvements is recursive inscription technology, which allows users to insert larger amounts of data into the bitcoin blockchain, bypassing the 4 megabyte per block storage limit.
Leonidas, a developer in the Audience community, offered a deeper perspective on the issue on Twitter, saying.
“What happens when a lot of people upload a lot of code packages? There is now a huge repository of packages that developers can build on. This enables complex use cases that are bigger than 4MB. The most complex piece of software is really just a bunch of code assembled and compiled. It becomes possible to build complex 3D video games on top of bitcoin, completely on-chain. The possibilities are endless. In effect, bitcoin gets an internal internet that allows files to request data from other files.”
In October, Lightning Labs announced the launch of the first mainnet for Taproot Assets (TARO), further enhancing the bitcoin blockchain as a multi-asset network. Among the many applications of the TARO protocol, one of the most promising is the ability to issue stablecoins on the bitcoin blockchain.
This paradigm shift is monumental, paving the way for bitcoin to become the primary medium of exchange for exchangeable assets.
It will allow developers to take successful use cases from other chains and bring them to the parent chain.
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