An Ode to Ordinals from a Bitcoin Maximalist

An Ode to Ordinals from a Bitcoin Maximalist

The Rise of Ordinals: Unlocking the Potential of the Bitcoin Ecosystem

This is an opinion editorial by L. Asher Corson, a partner at UTXO Management.

As Bitcoin Maximalists, we are always searching for ways to demonstrate the superiority of Bitcoin over other blockchains. And now, with the emergence of Ordinals, we have a powerful tool that enables functionalities previously unimaginable on the Bitcoin blockchain. These Ordinals have the potential to undermine the need for other blockchains to even exist.

Despite the strengthening position of Bitcoin, there are some who bizarrely celebrated decreased network fees and declared Ordinals to have failed. This mindset implies that Bitcoin might somehow benefit from the failure of the Ordinals protocol and lower miner earnings. But the truth is, Ordinals haven’t failed, and the interest in them is far from over. Trading volume of digital artifacts, unique satoshis, and BRC-20 tokens has reached historic levels.

So, what exactly are Ordinals? Developed by Casey Rodarmor, they are a protocol that enables any data to be included in a Bitcoin transaction. Using Ordinal Theory, this data is associated with a specific satoshi, allowing it to be owned and traded as digital assets directly on the Bitcoin blockchain, without the need for a peg or bridge.

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Bitcoin Maximalists understand that there have never been serious contenders to replace Bitcoin as digital money, and it’s unlikely any will ever emerge. Viable altcoin use cases have never been about having better monetary properties than Bitcoin, because that simply isn’t possible. Bitcoin’s absolute digital scarcity is unlikely to be replicated, as governments today understand the risks of letting decentralized networks grow too large.

However, viable altcoin use cases have been focused on features that Bitcoin couldn’t previously support. These include decentralized trading, non-fungible tokens (NFTs), stablecoins, capital formation, borrowing/lending, and on-chain leverage. Uniswap, a decentralized exchange, has witnessed almost $500 billion in trading volume since its launch in 2018. Additionally, Ethereum has seen $43.6 billion in NFT trading volume.

While these use cases have found acceptance in the market, my strong preference is for them to primarily exist on the Bitcoin blockchain, rather than on other chains. Having these use cases built on Bitcoin would be beneficial not only for Bitcoin itself but also for the larger effort to separate money and state. The presence of numerous competing chains hampers Bitcoin’s market share. Ordinals have the potential to not only enable these use cases on Bitcoin but also surpass their altcoin versions in terms of implementation.

Bitcoin is ideally suited for hosting these use cases because it is a more decentralized and secure protocol compared to altcoins. With the largest market capitalization among all the other chains, Bitcoin offers a solid foundation for developing these use cases. Furthermore, building these use cases on Bitcoin ensures they align more closely with the ideals of decentralization, immutability, and permissionlessness that Bitcoin epitomizes.

While the protocol itself cannot prevent scams, Rodarmor intentionally designed Ordinals with Bitcoin’s ideals at the forefront. For example, the implementation of digital artifacts through Ordinals is superior to how most NFTs were implemented on Ethereum and other chains. Digital artifacts provide stronger immutability, ensuring valuable or sensitive assets such as digital art or classified documents remain secure for hundreds or even thousands of years.

Bitcoin stands alone as the dominant force in the digital money world, and the rise of Ordinals only solidifies its standing. It goes beyond market capitalization dominance; it encompasses Bitcoin’s principles and the immense potential of its immutable blockchain. With Ordinals unlocking unprecedented opportunities within the Bitcoin ecosystem, a seismic shift is on the horizon. Bitcoin Maximalists have every reason to smile.

This is a guest post by L. Asher Corson. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

Disclosure: L. Asher Corson is a partner at UTXO Management, a subsidiary of BTC Inc., the parent company of Bitcoin Magazine.

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