Tesla CEO and billionaire Elon Musk seemed to inadvertently highlight the case for Bitcoin Ordinals, also known as Bitcoin NFTs, when he publicly mocked non-fungible tokens (NFTs) on a podcast.
“Interestingly, the NFT isn’t even on the blockchain — it’s just a JPEG URL,” Musk said in a statement released on October 31. interview About the Joe Rogan experience.
Musk said that NFT projects should at least encode JPEGs on the chain:
“You should at least encode the JPEG in the blockchain. If the company storing the image goes out of business, you no longer own the image.”
On social media, Bitcoin supporters argued that Musk’s comments actually summed up the use cases for Bitcoin’s ordinal numbers. The Bitcoin version of NFT was launched in January by developer Casey Rodarmor and implemented through the Taproot soft fork in November 2021.
Cryptocurrency analyst Will Clemente was among those who expressed appreciation for Musk’s remarks, noting that there will always be 38 million serial number inscriptions on the Bitcoin blockchain and counting. .
.@elonmusk You just laid out the case for the Bitcoin ordinal – an image/text inscription directly on the most secure open source currency network on Earth. There are currently 38 million such inscriptions on the Bitcoin blockchain. pic.twitter.com/WASj1qpkz8
— Will Clemente (@WCclementeIII) November 1, 2023
“That’s why the ordinal number will continue to grow,” explain Rohun “Frank” Vora, creator of NFT projects DeGods and y00ts. “This is the most elegant solution to one of the most common criticisms of NFTs.”
Ordinals developer is called “Leonidas” like Musk’s comments were so popular that they included the 19-second clip in block 814,773 of the Bitcoin blockchain:
Musk’s criticism of NFTs is not new. In December 2021, he mocked NFTs as a sign of mental illness in a meme showing a patient lying on a therapist’s couch.
— Elon Musk (@elonmusk) December 16, 2021
However, Musk’s comments do not apply to all NFT projects on Ethereum.
For example, Larva Lab moved Its Cryptopunks NFT went online in August 2021 after running off-chain for four years.
“Storing them on-chain in this way will further solidify the long-term survival of Cypherpunk images and properties and ensure they are fully accessible to anyone with only an Ethereum client,” Larva Labs said in a statement.
.@elonmusk It’s silly to have an NFT just provide an http link to someone’s domain, and rightly so.
However, with very few exceptions, it would be foolish to insist on putting NFT content on the chain.
IPFS links, content backed by people who own NFTs, are the natural solution.
— Arthur B. (@ArthurB) November 1, 2023
related: Is the NFT market in a death spiral or is it ready for a recovery?
Metagood, the team behind Ethereum-native OnChainMonkeys, announced in September that it was moving NFTs to Bitcoin.
While the company’s CEO Danny Yang didn’t directly address the JPEG dilemma, he explained that NFTs “will win on Bitcoin” because it’s a more secure network:
“The Bitcoin Ordinal protocol is better designed in terms of decentralization and security than the Ethereum NFT protocol. High-value NFTs will beat Bitcoin.”
However, Ethereum still accounts for 84% of all NFT transaction volume, according to Provide June data to CoinGecko. Bitcoin and ImmutableX ranked second and third, with market shares of 11% and 2.5% respectively.
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