For more than a decade, the dominant narrative surrounding Bitcoin (BTC) has focused on its role as peer-to-peer digital cash and store of value.
However, all signs indicate that we are witnessing a major shift in this paradigm.
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 previously mentioned use cases.
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If you’re sequestered in an igloo this crypto winter and don’t understand the goings-on, here’s a brief overview.
In January 2023, developer Casey Rodamor introduced Ordinals to the world, a protocol that allows you to permanently write any file to the Bitcoin blockchain.
It wasn’t the first method created for this type of action, but it gained the most attention, creating a trend of non-fungible token (NFT) collections, music, video games, news articles, and even WikiLeaks records Begins to be stored in an eternal storage space. Do it immutably on the world’s largest decentralized network.
“Anonymous activist group is writing about Afghanistan war logs released by WikiLeaks #bitcoin Protest against the imprisonment of Julian Assange” @bitcoinmagazine #FreeAssange https://t.co/1huZ6J9SDM
— WikiLeaks (@wikileaks) October 23, 2023
As a result, experimentation, innovation, and the promise of the Bitcoin network as a vast decentralized repository began to brew.
Although it is less than a year old, the Ordinals protocol has evolved significantly, becoming more efficient and supporting bolder use cases.
One of the noteworthy enhancements is recursive inscription technology, which allows users to circumvent the storage limit of 4 megabytes per block, enabling the insertion of larger data on the Bitcoin blockchain.
As an example (pictured below), I wrote an entire article about Bitcoin on Cointelegraph using recursive inscriptions.
A total of 8 inscriptions were produced to obtain the final result, with a total file size of 5.22 KB. (Small.) Seven of the inscriptions are images from the article, each individually stored in Satoshi via the Ordinals protocol. The eighth inscription contains a code that contains the text of the article and makes a request to retrieve images from other Satoshi.
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This assembly allows the complete article to be permanently inscribed on the Bitcoin blockchain, a feat that would have been impossible to accomplish in one step while maintaining quality.
Ordinals community developer Leonidas put forward a deeper perspective on the matter on Twitter, writing:
What if many people uploaded large packages of code to the Bitcoin blockchain? As a result, there is now a vast repository of software packages for developers to build on. This will unlock powerful use cases that could never fit under 4 MB. After all, the most complex software is just a bunch of code compiled together. Now, it is possible to fully link complex 3D video games to Bitcoin.
Complex 3D video games are entirely on the Bitcoin chain. The sky is the limit. Bitcoin is essentially an internal Internet, and each file can request information from other files on Bitcoin.It’s unclear how people will use it, but it’s certainly an important moment
— gaww.btc (@gawwbtc) June 17, 2023
With this, it’s possible to think and reimagine a world of possibilities. After all, the ability to use the world’s leading blockchain as an immutable, shared and uncensored data store is huge.
But the innovation doesn’t stop there!
In October, Lightning Labs announced the launch of the first mainnet of Taproot Assets (TARO), further enhancing the capabilities of the Bitcoin blockchain as a multi-asset network.
Announcing the first mainnet version of Taproot Assets, an asset protocol #bitcoin and lightning.
With this version, developers can issue financial assets on-chain in a scalable way.
Today marks a new era for multi-asset Bitcoin. https://t.co/2cNvZSvv8v
— Lightning Labs⚡️ (@lightning) October 18, 2023
The timing couldn’t be better, considering the enthusiasm the Ordinals protocol has ignited and the way it’s paved the way for TARO to join it.
The Ordinals Protocol broadens the horizons of users and builders, allowing them to build and treat Bitcoin as a multi-asset network.
Ordinals assets — flooding the network with transactions — forced Binance to implement integration with the Lightning Network. This key factor, coupled with low cost, decentralization and high network settlement speeds, makes trading other tokens and assets through Taproot Assets very attractive.
Among the various applications of the TARO protocol, one of the most mentioned is the ability to issue stablecoins on the Bitcoin blockchain.
This paradigm shift is monumental as it paves the way for Bitcoin to move from being primarily an exchangeable asset to a medium through which exchange occurs.
This innovation will enable developers to import successful use cases from other chains and bring them back to the mothership.
Some even joke that all other chains are just testnets for Bitcoin. Will it all come back to Bitcoin?
Bitcoin’s resurgence is unstoppable
The magicians are here @lightning Labs is back with an efficient token protocol on top of Bitcoin
Ethereum is a test network.Come in now. We’re going to the moon. pic.twitter.com/2g6vPFBAbV
— Udi Wertheimer (@udiWertheimer) May 16, 2023
Overall, we can say that we are on the verge of a new Bitcoin era – the multi-asset orange internet era.
In addition to attracting and retaining more developers who may be interested in these new protocols, these new applications also have the potential to attract and retain new users who initially have no interest or value in Bitcoin as a store of value.
For some, changing the world can sometimes be achieved by simply enjoying some fun crypto sports cards. But as ordinal numbers are optimized, the number of possibilities will continue to expand.
Hal Finney, a well-known cypherpunk and the first person to receive a transaction from Bitcoin creator Satoshi Nakamoto, in a 1993 article on Compuserve “Having thought more about the idea of buying and selling digital cash, I came up with a way to present it. We are buying and selling crypto trading cards,” he wrote.
Finny knew it, and now you know it too.
Luigi Tyrell is the Chief Commercial Officer of Lumx Studios, a Web3 studio whose investors include BTG Pactual Bank, Latin America’s largest investment bank. Lumx Studios has previously worked on Web3 cases with Coca-Cola, Anheuser-Busch InBev, Nestlé and Meta. The author holds investments related to the Ordinals protocol, although no investments are mentioned in this article.
This article is for general information purposes only and is not intended to be, and should not be construed as, legal or investment advice. The views, thoughts, and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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