Ordinals are a protocol on the Bitcoin blockchain that enables the identification and tracking of individual satoshis (the smallest unit of Bitcoin) by assigning them unique serial numbers. This allows for the creation, transfer, and storage of digital artifacts, such as NFTs (non-fungible tokens), directly on Bitcoin without requiring a separate layer or sidechain. Ordinals leverage Bitcoin’s existing infrastructure, particularly the Taproot upgrade, to embed data into transactions, making them a groundbreaking innovation in the Bitcoin ecosystem.
What Are Ordinals?
Ordinals are a system that assigns a unique identifier to each satoshi, enabling them to be tracked and inscribed with data. This process, known as “inscription,” allows users to attach arbitrary data, such as text, images, or other digital content, directly onto the Bitcoin blockchain. These inscribed satoshis can then function as digital artifacts, similar to NFTs on other blockchains, but with the added security and decentralization of Bitcoin.
The concept of Ordinals relies on the ordinal theory, which orders satoshis based on their mining sequence. By leveraging Bitcoin’s Taproot upgrade, Ordinals can store data efficiently and securely within Bitcoin transactions. This innovation has opened up new use cases for Bitcoin, transforming it from a purely monetary network into a platform for digital collectibles and other applications.
Who Created Ordinals?
Ordinals were created by Casey Rodarmor, a software engineer and Bitcoin developer. Rodarmor introduced the Ordinals protocol in January 2023, presenting it as a way to expand Bitcoin’s functionality without altering its core principles. His work was inspired by the desire to bring NFTs and digital artifacts to Bitcoin while maintaining the blockchain’s decentralization and security.
Rodarmor’s approach was unique because it did not require changes to Bitcoin’s consensus rules or the addition of a new layer. Instead, it utilized existing features, such as Taproot and SegWit, to enable the inscription of data directly onto the Bitcoin blockchain.
When Were Ordinals Introduced?
The Ordinals protocol was officially launched in January 2023. Its introduction coincided with growing interest in NFTs and digital collectibles across the broader cryptocurrency ecosystem. While NFTs had already gained significant traction on blockchains like Ethereum and Solana, Ordinals brought this concept to Bitcoin for the first time.
The timing of Ordinals’ launch was significant, as it followed the activation of Bitcoin’s Taproot upgrade in November 2021. Taproot provided the technical foundation necessary for Ordinals by enabling more efficient data storage and enhanced privacy features within Bitcoin transactions.
Where Are Ordinals Used?
Ordinals are used directly on the Bitcoin blockchain. Unlike NFTs on other platforms that often rely on separate blockchains or sidechains, Ordinals operate natively within Bitcoin’s existing infrastructure. This means that all data associated with Ordinals, including inscriptions, is stored on-chain, ensuring permanence and immutability.
The use of Ordinals is not limited to any specific geographic location. As part of the Bitcoin network, they are accessible to anyone with an internet connection and a Bitcoin wallet that supports the Ordinals protocol. This global accessibility aligns with Bitcoin’s ethos of decentralization and inclusivity.
Why Are Ordinals Important?
Ordinals are important because they expand Bitcoin’s functionality beyond its original use case as a peer-to-peer electronic cash system. By enabling the creation and transfer of digital artifacts, Ordinals introduce new use cases for Bitcoin, such as:
- Digital Collectibles: Users can create and trade unique digital items, similar to NFTs on other blockchains.
- Art and Media: Artists can inscribe their work directly onto the Bitcoin blockchain, ensuring its permanence and provenance.
- Historical Records: Important documents or data can be stored immutably on Bitcoin.
Additionally, Ordinals demonstrate the versatility of Bitcoin’s infrastructure, showcasing how it can support innovative applications without compromising its security or decentralization. This has sparked renewed interest in Bitcoin development and attracted a new wave of users and creators to the network.
How Do Ordinals Work?
Ordinals work by assigning a unique serial number to each satoshi based on its order of mining. This numbering system is made possible by ordinal theory, which tracks the sequence of satoshis as they are created and transferred.
The process of creating an Ordinal involves “inscribing” data onto a satoshi. This is achieved by embedding the data into a Bitcoin transaction using the Taproot upgrade, which allows for efficient and secure data storage. Once inscribed, the satoshi becomes a digital artifact that can be transferred and traded like any other Bitcoin transaction.
To interact with Ordinals, users need a Bitcoin wallet that supports the protocol. These wallets enable users to view, send, and receive inscribed satoshis, as well as create new inscriptions. The entire process is conducted on-chain, ensuring transparency and immutability.
By leveraging Bitcoin’s existing features, Ordinals provide a novel way to use the blockchain, opening up new possibilities for creators, collectors, and developers.
