Ordinals

Daily gas spent on EVM inscriptions surges to record high of $8M

Bitcoin is not the only network getting clogged up with Ordinals inscriptions, with weekend activity on EVM chains also spiking.

Network transaction fees across all blockchains have spiked over the weekend as the Ordinals inscriptions craze continues to push demand for blockspace — and not just on the Bitcoin network.

Inscriptions on Ethereum Virtual Machine (EVM) chains skyrocketed over the weekend, causing a spike in gas fees.

On Dec. 16, gas spent on inscriptions surged to a record high of $8.3 million, according to data from Dune Analytics.

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Bitcoin fees hit 20-month high as miner revenues match $69K BTC price

Bitcoin miners are the main beneficiaries of current sky-high transaction fees, data shows, but many longtime market participants have little time for complaints.

Bitcoin (BTC) on-chain transaction fees are dividing opinion as the cost of sending BTC skyrockets.

Data from the statistics resource BitInfoCharts puts the average transaction fee at nearly $40 as of Dec. 17.

The latest wave of Bitcoin Ordinals inscriptions has resulted in elevated transaction fees for all network users — but some believe that they are here to stay.

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Bitcoin Ordinals could be stopped if blockchain bug is patched, claims dev

A Bitcoin Core developer claimed Bitcoin Ordinals exploit a vulnerability allowing inscribers to bypass data size limits, which could soon be fixed.

A bug fix on the Bitcoin network could put a stop to new Bitcoin Ordinals and BRC-20 tokens causing network congestion by “exploiting a vulnerability,” claims a Bitcoin Core developer.

In a Dec. 6 X (formerly Twitter) post, developer Luke Dashjr said inscriptions — used by Ordinals and BRC-20 creators to embed data on satoshi’s — exploit a Bitcoin Core vulnerability to “spam the blockchain.”

He explained the Bitcoin Core code has allowed users to set limits on the size of extra data in transactions since 2013, but “by obfuscating their data as program code, inscriptions bypass this limit.”

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Bitcoin Ordinals community debates fix after inscription validation bug

Currently, over two-thirds of voters on a Twitter poll said the missed inscriptions should be added at a later date instead of there being a retroactive reshuffling.

A few solutions are being discussed to fix a code bug found in the Bitcoin (BTC)-native Ordinals protocol that has prevented over 1,200 inscriptions from being validated.

While nearly every member of the Ordinals community agrees that these inscription requests should be reincluded, the community is debating whether they should be added retroactively or not.

The bug came from the indexer function of the protocol only counting inscriptions that were in the first input of a transaction submitted up to and including version 0.5.1 of the protocol.

One prominent Ordinals member known on Twitter as “Leonidas.og” summarized the pros and cons of each solution in an April 10 tweet, coming a few days after the issue was first made public on April 5 by the GitHub user “veryordinally.”

The first solution involves selecting a block height to retroactively index the so-called “orphan” inscriptions from inscription number 420,285 onwards, which is roughly where the first orphan inscription was identified.

“This feels like the ‘purist’ solution because it means the ordinals protocol would correctly match the logical ordering on-chain,” Leonidas.og explained, despite acknowledging that the reshuffling “may cause other complications.”

The alternative is to not change inscription numbers that have already been validated and to pick a block height to add these orphan inscriptions in at some time in the future, Leonidas.og explained:

“This would not change any existing inscription numbers so the ~1,200 orphans would not be assigned inscription numbers officially in the protocol. It would be up to the market to value them as ‘misprints’ or not.”

Another Ordinals GitHub community member, “Yilak,” argued in favor of not changing up the order because only a fraction of inscription owners have been impacted.

Related: Bitcoin Ordinals daily inscriptions surge due to ‘BRC-20 tokens’

At the time of writing, 67.5% of 1,266 voters are in favor of not changing the inscription numbers, according to a Twitter poll created by Leonidas.og.

On April 8, the number of Bitcoin Ordinals inscriptions surpassed 1 million, according to data from the crypto analytics platform Dune. It came just days after daily new inscriptions hit a record of over 76,300 on April 4.

Ordinals are considered to be digital artifacts on the Bitcoin network, similar to nonfungible tokens. They can compromise of images, PDFs, video or audio formats.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom

Bitcoin Ordinals daily inscriptions surge due to ‘BRC-20 tokens’

The BRC-20 token standard utilizes Ordinal inscriptions to deploy token contracts, mint tokens and transfer tokens.

A new daily all-time high has been recorded for the number of Ordinals inscribed on the Bitcoin (BTC) network due to a recently launched “token standard” for the blockchain.

Bitcoin Ordinals reached 58,179 inscriptions on April 2, smashing the previous all-time high of 31,692 on March 9 by 83.5%, according to Dune Analytics data.

The surge is believed to be driven by the recent creation of “Bitcoin Request for Comment” (BRC-20) tokens on the Ordinals protocol by a pseudonymous on-chain analyst named Domo in early March.

Daily count of Ordinals inscriptions shown in green. Source: Dune Analytics

While Ordinals are nonfungible token (NFT)-like “digital artifacts” which carry data in the form of text, JPEG images, PDFs, video and audio formats on the Bitcoin network, the BRC-20 token standard utilizes Ordinal inscriptions to deploy token contracts, mint tokens, and transfer tokens — similar to Ethereum’s ERC-20 token standard.

The arrival of Ordinals and BRC-20 tokens on Bitcoin were enabled by the Taproot soft fork, which took effect on Nov. 14, 2021.

Over 55,000 of the inscriptions on April 2 came in the form of text-based Ordinals, many of which were represented by BRC-20 tokens, according to “Leonidis.og,” the host of an Ordinals-focused podcast.

BRC-20 tokens — which are categorized as text-based Ordinals — are the most commonly inscribed Ordinal on Bitcoin. Source: Dune Analytics.

Leonidis explained in a tweet that the spike on April 2 came on the back of new tools used to interact with BRC-20 tokens launched in the last few days.

“There was a lot of excitement around BRC-20 when it launched a month ago but eventually the hyped died down. During the lull, devs built tools to make interacting with BRC-20 much easier and now we’re seeing ATH interest. I’ve said it before and I will say it again. UX matters!”

Among those new tools include Ord.io, UniSat Wallet and BRC-20.io. According to BRC-20.io, 1,600 tokens have been created since the BRC-20 standard was created.

Among the most popular BRC-20 tokens include “pepe,” “ordi,” and “punk,” currently boasting respective market caps of $2.5 million, $2.1 million and $900,000.

Related: Bitcoin Ordinals creator looks for fix after first instance of shock porn

Over 42,700 BRC–20 tokens have been minted in the last 24 hours, mostly coming from the tokens wzrd, domo, BAYC, meme and pups.

Bitcoin tokens, through the BRC-20 standard, can now be bought and sold on marketplaces, similar to Ethereum ERC-20 tokens. Source: BRC-20.io

While the market cap of BRC-20 tokens currently sits at less than $10 million, digital asset investment firm Galaxy Digital believes the “Bitcoin NFT” market may reach $4.5 billion by 2025.

Members of the Bitcoin community are still split on whether Ordinals is a good fit for the Bitcoin ecosystem. Proponents such as Dan Held suggest it offers more financial use cases on Bitcoin, while others say it’s straying away from Satoshi Nakamoto’s vision of Bitcoin as a peer-to-peer cash system.

Magazine: 4 out of 10 NFT sales are fake: Learn to spot the signs of wash trading

Magic Eden launches marketplace for Bitcoin Ordinals

It’s one of the first major NFT marketplaces to join the Bitcoin Ordinals fray, which as of March 21 boasted 567,087 inscriptions.

Nonfungible token marketplace Magic Eden has launched its own “fully audited” marketplace for Bitcoin Ordinals, leveraging the surging interest in “Bitcoin NFTs.” 

The newly launched marketplace allows Bitcoin (BTC) NFT traders to buy and sell Bitcoin Ordinal collections, giving users a similar experience to the one that Magic Eden offers for Polygon, Ethereum and Solana-based NFTs.

“Just as we have expanded into other chains, we now aim to bring our expertise in building marketplaces to the nascent, yet flourishing Ordinals ecosystem,” the firm said in a March 21 statement. 

The new Ordinals protocol was introduced in January by former Bitcoin core contributor Casey Rodarmor. Since then, the popularity of Bitcoin Ordinals has surged.

According to data from Dune analytics, between Feb. 1 and March 1, the total number of Bitcoin Ordinals inscriptions surged from 679 to 240,000. As of March 21, a total of 567,087 have been inscribed.

“We paid close attention to the release of Ordinal Theory and the lightning pace of adoption that soon followed,” said Magic Eden, adding:

“Our marketplace was built within a month, culminating in a hackathon in California with over a dozen devs.”

Currently, the marketplace only supports secondary sales of Bitcoin Ordinals. The marketplace said it is also looking into future tools that would allow creators to more easily mint or inscribe Bitcoin NFTs, such as its launchpad, which it offers for other chains.

In order to enable permissionless swaps, it uses partially signed Bitcoin transactions — a Bitcoin standard that allows multiple parties to sign the same transaction — rather than smart contracts.

The marketplace launched with over 70 collections. Source: Magic Eden

Meanwhile, Magic Eden says while there will be no royalty support for the marketplace, it is “actively looking” into this, adding there is “very little tooling and no secure and trustless enforcement solutions.” 

“With no royalty standard today, we have decided to launch on Bitcoin without royalty support for now,” said Magic Eden.

“We believe that this is most in-line with the ethos of the ecosystem, and despite this, we are actively looking into the development of an on-chain, permissionless royalty standard and are committed to working with creators and the greater community,” it added.

Related: Bitcoin thought leaders weigh the pros and cons of Ordinals

Other Bitcoin Ordinals marketplaces have already launched, including ORDX and Generative XYZ, which launched in February. Earlier this week, NFT platform Gamma.io unveiled its own Bitcoin Ordinals marketplace, allowing users to create and trade ordinal inscriptions in a manner similar to Ethereum NFT marketplaces.

Cointelegraph contacted Magic Eden for comment but did not immediately receive a response.

Related: Become a hot new NFT artist via the ‘soft shell taco method’ — NFT creator Terrell Jones

How to create and sell Bitcoin NFTs

Bitcoin NFTs have taken the crypto world by storm in a blink of an eye. Here’s all you need to know about Bitcoin Ordinals and how to create and sell them.

Bitcoin nonfungible tokens (NFTs) have captured the crypto world’s attention fast, opening new opportunities for the oldest blockchain and digital art enthusiasts. Since their explosion in 2020, NFTs have been typically minted and traded on Ethereum-based platforms, besides other blockchains, such as Cardano and Solana. 

However, a new protocol known as Ordinals was launched in January 2023 by former Bitcoin Core contributor Casey Rodarmor, who exploited the 2021 Bitcoin Taproot upgrade to expand the cryptocurrency capability and enable on-chain Bitcoin-native NFTs.

Taproot offered a way to expand the base layer’s block capability by condensing the size of transactions requiring less data usage and encouraging the use of smart contracts on Bitcoin. The upgrade considerably increases the types of transactions possible on Bitcoin, including decentralized finance (DeFi) and NFT applications.

By February 2023, the world’s largest issuer of NFTs, Yuga Labs, had already announced the creation of TwelveFold, a new NFT collection issued on Bitcoin, thereby endorsing Bitcoin NFTs and avouching their success.

Here’s what you need to know about Bitcoin NFTs, how they differ from the most popular Ethereum-based alternative, and how to create and sell them.

What are Ordinals?

Ordinals are serial numbers imprinted in a single, unique satoshi (sat), the smallest unit of Bitcoin (BTC), through the ordinal theory that assigns them in the order in which they are mined. The first satoshi in the first block has the ordinal number 0, the second has the ordinal number 1, and the last satoshi of the first block has the ordinal number 4,999,999,999.

Colored coins were the first representation of such a concept back in 2012, being crypto assets repurposed to represent something of value by adding metadata information. Counterparty is another attempt to embed data into regular Bitcoin transactions. However, it has its own XCP token, required for some functionality, making it officially like an altcoin and not an extension or second layer for Bitcoin.

The ordinal theory rewards satoshis with numismatic value, allowing them to be collected and traded as rarities. Satoshis are given individual identities to be tracked, transferred and ingrained with meaningful arbitrary data, such as pictures, text or videos, through a Bitcoin transaction that remains permanently part of the blockchain. Such data can be viewed in Ordinals-compatible wallets, such as the Sparrow wallet, and online explorers.

Inscriptions

The process of assigning assets to individual satoshis is called inscription. Inscriptions are digital artifacts native to the Bitcoin blockchain, the digital equivalent of physical artifacts.

They are fully on-chain, do not require a sidechain or a separate token, and use the Ordinals protocol to inscribe sats with content on ord, an index, an explorer and a wallet that relies on Bitcoin Core for private key management and transaction signing.

Ord allows tracking the location of specific satoshis and their ordinal numbers and can be viewed with the Ordinals explorer. In contrast with traditional NFTs that rely on off-chain content stored on the interplanetary file system (IPFS), inscriptions are gifted with Bitcoin’s immutability and security. They are permissionless and uncensorable digital artifacts since they can be sold without a royalty.

How to create Bitcoin NFTs

The Ordinals ecosystem is in full development, but its accessibility is still restricted to two primary ways to mint an ordinal NFT.

The first method to inscribe Bitcoin Ordinals requires some technical skills, running a full Bitcoin node and then installing Ord on this node to inscribe satoshis into an Ordinals wallet and make Bitcoin Ordinals NFTs. Two types of Bitcoin wallets can process Ordinals; they both must be Taproot-compatible and have a “coin control” capability to avoid spending Ordinal satoshis as network fees or sending them accidentally in another transaction.

  • The Sparrow wallet is only recommended for receiving Ordinals to avoid sending Ordinals sats inadvertently. However, using it does not require running a full node. Here’s how to set up a Sparrow wallet.
  • An Ord wallet requires running a full node on 500GB capacity. Unlike the Sparrow wallet, an Ord wallet allows you to create inscriptions and freeze the inscribed sats to prevent accidental spending. Here’s how to set up an Ord wallet.

Regardless of the wallet you’re using, make sure to have some Bitcoin available to pay for the transaction fee.

The second method is more straightforward and involves using a no-code tool, such as Gamma or Ordinalsbot.com, to inscribe your ordinal NFT. Here’s how to mint your Ordinal on Gamma:

  • Select the type of file you’d like to use to mint your Bitcoin NFT.
  • Upload the necessary file from your computer.
  • Set up the transaction fee depending on how long you’d like to wait for your Ordinal to be minted.
  • Copy and paste the Bitcoin address where to send the digital artifact, which needs to be an Ordinal-compatible address or a Taproot address.
  • Wait for the NFT to be minted. Such a wait depends on the fee you paid for the process to be completed and may be hours or even days. You’ll be able to track the minting status through a link you’ll receive by email.
  • View your minted Ordinal on OrdinalsViewer.

How to trade Ordinals

While proper infrastructure and marketplaces to trade Bitcoin Ordinals are being built, the digital artifacts are traded peer-to-peer over-the-counter (OTC) in dedicated Discord servers, with escrows as intermediaries and tracked on Google sheets.

Compared to the more popular NFTs traded via Ethereum and other blockchains, Bitcoin Ordinals trading appears to be an obsolete method. Yet this hasn’t contained people’s interest in Bitcoin NFTs, with hundreds of thousands of newly minted digital artifacts emerging within only a few weeks from launch.

The Ordinals market is entirely trustless, using the secure, partially signed Bitcoin transactions (PSBT) technology, which allows users to easily sign transactions in cold storage, and atomic swaps with no intermediary and a market fee of 2.7%. A system to verify creators is being developed to include creator royalties of 4.2%.

How to buy Bitcoin NFTs

Taproot-compatible wallets must be used to buy Bitcoin Ordinals, such as the Ordinals wallet, the Xverse and Hiro wallets. The Ordinals wallet is very straightforward to use, and the others are also similar:

  • Create an account, secure your seed phrase, and deposit funds into the wallet.
  • Select the Ordinals you wish to purchase and click “Buy Now.”
  • Once the transaction has been executed, the Ordinals will be added to your wallet.

How to sell Bitcoin NFTs

Similar to buying a Bitcoin NFT, you’ll need to pick a Bitcoin Taproot-compatible wallet and download it.

  • Create an account, secure your seed phrase, and upload your inscription. The fee will depend on the file size and how fast you’d like the transaction completed.
  • Once your file has been inscribed onto the blockchain, you can view it on the Ordinals.com inscriptions page.
  • You can freeze the Ordinals to make sure you do not spend them.
  • You’ll need to use a peer-to-peer OTC market, usually, the Bitcoin Ordinals Discord server, to sell your inscription.

It is recommended that particular attention is placed on these trades. Being in an unregulated peer-to-peer OTC market, platforms are full of scammers trying to catch the latest Bitcoin NFT craze.

Ordinals vs. traditional NFTs

A few differences distance Ethereum-based traditional NFTs from Bitcoin Ordinals, although they both tend to be grouped under the same umbrella of digital art. The creator of Bitcoin Ordinals, Casey Rodarmor, defines Bitcoin NFTs as authentic digital artifacts because they are on-chain and enjoy all of the good properties Bitcoin holds. Here are the main differences:

  • Bitcoin inscriptions are always immutable, while Ethereum-based NFTs can technically be changed or deleted by the contract owner. Traditional NFTs must be audited to become immutable, which requires deep knowledge of the Ethereum Virtual Machine (EVM) and Solidity.
  • Bitcoin inscriptions always have on-chain content, making it impossible to be lost. It is durable and scarcer because inscription creators must pay fees proportional to the size of the content. In contrast, Ethereum NFT content can be off-chain and stored on platforms such as IPFS and could be lost.
  • Bitcoin inscriptions are more secure because the blockchain is the most secure. Inscriptions can be sold with PSBT without needing a third party, such as an exchange or marketplace, to transfer them on the user’s behalf. On the other hand, Ethereum NFTs tend to grant intermediary platforms unlimited permission over a user’s NFT, and the use of complex smart contracts may be challenging to interact with for the regular non-techie who wants to trade digital art.

Unlike NFTs, which are minted as completely new tokens, Ordinals have the raw file data inscribed directly onto the sats on the Bitcoin blockchain.

Bitcoin NFTs controversy

The new Ordinals protocol has raised an important question and sparked a heated debate among the NFT community. Should Bitcoin just be money, or should it expand its functionality to other use cases? Is the Ordinals protocol an attack on the Bitcoin network?

The Bitcoin blockchain has traditionally been used only for payment transactions due to its limited block size and network architecture. Such infrastructure favors solutions built on top of the blockchain as additional layers to increase the network’s programmability and scalability.

The latest Ordinals craze has raised many eyebrows among the BTC community. Some are concerned it could distract from Bitcoin’s primary use case as a medium of exchange and whether Ordinals make good use of block space. Ordinals can be images, audio clips or even games inevitably requiring space that is subtracted from the financial data, significantly slowing down on-chain confirmation times.

Bitcoin’s fungibility

Bitcoin’s fungibility — one of the main properties of money — is also challenged by Ordinals. This is because inscriptions are imprinted in one satoshi, making it a rare unit, just like numismatic coins are rare physical objects used for collections.

Ordinal satoshis become individual identities that can be tracked, transferred and imbued with meaningful information, such as text or an image, making the sat unique and turning it into a de facto NFT. On the other hand, the traditional stance views all satoshis as equal, or they begin to lose a significant trait of money.

Full node costs

A few weeks after the project was launched, a record-breaking-sized block of 4MB was created, raising concerns among the community about the future efficiency and costs of the blockchain and its full nodes. The average size of a Bitcoin block had never exceeded 1.5MB until the launch of Ordinal NFTs.

Inscription contrarians fear that increasing the Bitcoin blockchain size due to the big transactions and blocks would raise the requirements and costs for devices running a full node. The counterargument is that for the Bitcoin blockchain to be securer, its blocks must be full, which would justify users paying a higher fee.

The debate will unfold in the future as the Ordinals market takes a more robust shape and new opportunities arise. Ultimately, Bitcoin’s true spirit and value reside in its resilience to guide the market in the direction the people want.

Yuga Labs’ first Bitcoin NFT auction nets $16.5M in 24 hours

The highest of the 288 bidders forked out just over 7 BTC for one of the 288 Bitcoin Ordinals-based NFTs up for auction.

The auction for Yuga Labs’ inaugural Bitcoin Ordinal nonfungible token collection has ended, netting the firm $16.5 million in just 24 hours. 

A total of 288 bidders won one of the Bitcoin NFTs from the “TwelveFold” collection. Yuga said the winners will receive their inscription within one week, while the unsuccessful bids will have their bid amount returned within 24 hours.

The auction yielded 735 Bitcoin (BTC) worth an estimated $16.5 million at current prices. The highest of the 288 bidders paid just over 7 BTC or $161,000 for one of the pieces.

Top 10 bids leaderboard. Source: TwelveFold
Bottom ten bids, the lowest won #288. Source: TwelveFold

Yuga announced the collection in late February, describing it as a “base 12 art system localized around a 12×12 grid, a visual allegory for the cartography of data on the Bitcoin blockchain.”

TwelveFold #1 won by the highest bidder. Source: Yuga Labs

It comprises a limited edition collection of 300 generative pieces inscribed on Satoshis on the BTC network. The lucky winners were eager to share their new NFTs online:

Related: Nifty News: Yuga Labs jumps on Ordinals hype

As reported by Cointelegraph, Yuga Labs received backlash over the weekend from the crypto community, which identified flaws in how Yuga conducted the auction for the Ordinals collection.

‘Scammers dream’ — Yuga’s auction model for Bitcoin NFTs sees criticism

Yuga Labs’ first Bitcoin NFT collection saw some backlash from the crypto community over the weekend, pointing to flaws in how it conducts the auction.

Nonfungible token (NFT) company Yuga Labs faces criticism from the cryptocurrency community, including the creator of Bitcoin Ordinals, over how it plans to auction its new Bitcoin NFT collection. 

On March 5, Yuga opened bids for its “TwelveFold” collection, which will see 300 NFT-like images inscribed on satoshis using the Bitcoin-native Ordinals protocol, with 288 from the collection sent to the highest 288 bidders.

According to a March 5 press release, those participating in the bidding process must send their entire bid amount in Bitcoin (BTC) to a unique BTC address controlled by Yuga. Winners would simply pay up the BTC they bid, while Yuga said it would return BTC to those unsuccessful in placing a top bid.

However, such a plan has earned the ire of some within the crypto community, with some pointing out that having to conduct refunds for unsuccessful bids manually is like the “stone age.”

The user behind an Ordinals-focused Twitter account “ordinally” called the auction model a “scammers dream,” adding while they doubt Yuga would keep the BTC from failed bids, the way it carries out the auction sets a “REALLY bad precedence.”

The post even saw a response from Bitcoin Ordinals creator, Casey Rodarmor, who hotly weighed in on the discussion, telling Yuga to “get fucked” and calling the conduct of the auction “degenerate bullshit.”

He added if Yuga were to conduct a similar auction he would encourage others to boycott the project.

Other users pointed out the shortcomings of the auction system, saying it’s possible some could overpay for a TwelveFold due to a potential significant price discrepancy between the highest and lowest bids in the top 288.

Despite the criticism from some, many were happy to see a large project such as Yuga — which rose to prominence due to multiple Ethereum-based NFT collections — bridge across to Bitcoin.

Related: Luxor Mining acquires OrdinalHub amid Bitcoin-based NFTs hype

Ordinally, who criticized the collection, later tweeted appreciation of “the fact that Yuga took the effort to attempt [to] go a Bitcoin route when setting up this auction.”

An Ordinals-based collection, Ordinal Pizza OG, expressed excitement at Yuga’s BTC collection and called it a “massive net positive for Ordinals.”

The criticisms weren’t enough to stop cashed-up bidders from wanting to try to cement a top spot to nab Yuga’s first BTC collection.

At the time of writing, the top bid was 1.11 BTC (around $25,000), according to the TwelveFold website with the lowest bid registered showing as 0.011 BTC, or around $250.

Galaxy tips Bitcoin NFT market to hit $4.5B by 2025

Galaxy’s estimation was based on the rapid uptick of interest in Bitcoin NFTs, currency market infrastructure, and the potential to take some market share away from Ethereum.

In a “base case” scenario, Galaxy Digital’s research unit has tipped the burgeoning Bitcoin nonfungible token (NFT) market to hit a $4.5 billion market cap by March 2025.

Bitcoin NFTs, or Ordinals, have attracted significant attention since the Ordinals protocol launched in late January, enabling users to inscribe data such as images, PDFs, video and audio onto individual satoshis — each representing 0.00000001 Bitcoin (BTC).

NFT giants such as Yuga Labs have even jumped in on the hype. On Feb. 28, the $4 billion firm behind the Bored Ape Yacht Club announced a Bitcoin-based NFT project dubbed “TwelveFold” in a notable recognition of the Ordinals movement.

In a new report published on March 3, Galaxy researchers analyzed the potential growth of Bitcoin NFTs, making estimations “conservatively based on the current size of Ethereum’s NFT market” and its growth rate over the past few years.

“While there are notable differences between inscriptions and NFTs, it’s fair to say that a native on-chain ecosystem for NFTs has emerged on Bitcoin in a way that was never before possible, and its usage has been exploding.”

The report provided three market cap predictions based on the firm’s analysis, covering bear, base and bull case scenarios.

Looking at Galaxy’s baseline analysis, the report outlined that if Bitcoin NFTs can “expand to mainstream NFT culture like PFPs [Profile Pictures], memes and utility projects,” the market capitalization should increase to $4.5 billion.

The researchers also noted that the projection of $4.5 billion is also based on the “rapid development in inscription awareness coupled with the marketplace/wallet infrastructure already out today.”

In a bear case, in which Bitcoin NFTs don’t creep into the mainstream NFT market and pry market share away from Ethereum, Galaxy estimated that Bitcoin NFTs can still reach a market cap of $1.5 billion based on the current level of interest and supporting infrastructure.

Related: Total crypto market cap takes a hit amid Silvergate Bank crisis

On the bullish side of things, Galaxy researchers estimate that the Bitcoin NFT market could reach around $10 billion if it provides strong competition to Ethereum NFTs while providing unique use cases.

Estimated Bitcoin NFT market cap. Source: Galaxy Digital

At the time of the report, more than 250,000 Ordinals have hit the market. Highlighting the significance and utility of Bitcoin NFTs, the researchers noted that:

“The addition of sizeable data storage with strong availability assurances opens up a variety of use cases, many of which are only beginning to be explored, including things like new types of decentralized software or Bitcoin scaling techniques. Even the NFT use case alone, though, has the potential to dramatically widen the scope of Bitcoin’s cultural impact.”