In December 2022, Bitcoin developer Casey Rodarmor launched an open source software called ORD, which runs on the Bitcoin Core full node. The emergence of ORD marks a major innovation in the Bitcoin ecosystem, which enables users to mint Bitcoin NFTs (non-fungible tokens) in two steps: First, add arbitrary information (such as text strings or images) Burn it onto the Bitcoin blockchain (called an "imprint"); second, attribute that imprint to an individual satoshi ("ordinal/ordinal theory"). In Bitcoin, satoshi is the smallest unit, and 1 BTC is equal to 100,000,000 satoshi.
engraving process
During the imprinting process, arbitrary information is burned into the taproot script in the witness data of the Bitcoin transaction. Unlike the minting of Ethereum NFTs, where each new NFT created generates an independent ERC-721 token, imprinting does not create new tokens. Instead, it ties arbitrary information to existing tokens (satoshis).
The implementation of engraving benefits from two updates of Bitcoin: Segregated Witness (SegWit for short) and Taproot. SegWit was implemented in July 2017, increasing the size of witness data, while Taproot was finalized in November 2021, making it easier to insert arbitrary witness data into Bitcoin transactions.
Potential Impact of Imprinting
The contents of the imprint are saved in the input of the Bitcoin transaction, and the imprint is connected to the first satoshi in its first output. According to ordinal theory, this satoshi can be tracked and can be transferred, bought and sold, lost due to handling fees, or recovered.
However, the engraving has also caused some controversy. Many people believe that using taproot scripts to store arbitrary data was not the original intention of Taproot updates. If the Bitcoin community had known about this unintended consequence, Taproot updates might not have been enabled. However, it is no longer possible to restrict the taproot script to this specific use, so the emergence of Ordinals has become an irreversible reality.
The future of Bitcoin NFTs
With the launch of ORD, the concept of Bitcoin NFT is developing rapidly. Many investors and creators are beginning to explore how to leverage this new technology to create unique digital assets. As a decentralized digital currency, the security and transparency of Bitcoin's blockchain provide a reliable basis for NFT transactions.
In addition, the emergence of ORD may also promote the diversified development of the Bitcoin ecosystem. As more and more users begin to participate in the creation and transactions of Bitcoin NFTs, this will further promote the popularity and application of Bitcoin.
in conclusion
The emergence of ORD and Ordinal theories has brought new possibilities to Bitcoin. Despite some controversies and challenges, the potential value and application prospects of Bitcoin NFT are undoubtedly exciting. As technology develops further, we can expect more innovations and changes in the future, which will not only change our understanding of Bitcoin, but also reshape the entire digital asset market.
In the future digital world, Bitcoin NFT may become an indispensable element, providing more opportunities and choices for creators and investors. As this space continues to grow, we look forward to seeing more innovations and breakthroughs that allow Bitcoin to realize its full potential.