Following the debut of the Dencun upgrade and Ethereum blobs, enthusiasts have devised methods to embed data akin to how Ordinal inscriptions operate. Since this development, inscription-based activities now account for over 40% of blob transactions, leading to a significant increase in network activity. This uptick has resulted in a congestion of blob transactions, pushing […]
Bitcoin News
Bitcoin’s Ordinal Inscriptions Soar Beyond 55 Million, Achieving Third Highest Daily Record
Following the weekend, the tally of Ordinal inscriptions on the Bitcoin blockchain surpassed 55 million. Notably, on Jan. 13, 2024, the blockchain witnessed its third-highest day of inscriptions, settling an impressive 477,751 inscription-based transactions on Saturday. Additionally, from the inception of the first inscription in December 2022, bitcoin miners have amassed 6 million worth of bitcoin, capitalizing on this growing trend.
Miners Net 6 Million From 55 Million Inscriptions
From Dec. 28, 2023, to Jan. 12, 2024, the pace of daily Ordinal inscriptions on the Bitcoin blockchain moderately decelerated. However, a surge occurred on Saturday, Jan. 13, marking a record-breaking number of daily inscriptions. This date became the third-largest in terms of inscriptions, with an impressive 477,751 added to the blockchain. That day, approximately 652,483 transactions were processed, with inscriptions comprising a notable 73.22% of all miner-confirmed transfers.
Continuing the trend, on Sunday, Jan. 14, 2024, the blockchain saw another substantial 446,783 inscriptions being incorporated into the distributed ledger system. This indicates that, of the 591,806 verified transfers, a substantial 75.49% were inscription-based. Furthermore, following these two record-setting days, the total number of inscriptions impressively exceeded the 55 million threshold this weekend. Among these inscriptions, miners have accumulated a total of 5,750 BTC, valued at 6 million, based on the current BTC exchange rates.
Around .7 million in fees from inscriptions were paid to miners on Jan. 13 and the following day, miners accrued another .94 million. Bitcoin miners are reaping the benefits from fees paid by inscriptions and on Dec. 16, 2023, miners nabbed .9 million in fees. Moreover, the number of inscriptions per block has increased a great deal as minters have learned ways to fit in as many as possible. Data further shows that there are 278,296 recursive inscriptions on the chain as well.
Recursive ordinal inscriptions entail retrieving and incorporating data from existing inscriptions to craft new ones. In the realm of Ordinal inscriptions traded on non-fungible token (NFT) markets, Bitcoin has taken the lead in the past 30 days, boasting 9.53 million in digital collectible sales. Ethereum, previously the frontrunner in NFT blockchain, recorded 1.18 million in sales during the same period. Yet, on a weekly basis, BTC’s lead is marginal, with sales of .68 million, narrowly surpassing Ethereum’s .42 million.
What do you think about Ordinal inscriptions surpassing the 55 million mark and the third highest day of inscriptions on record? Share your thoughts and opinions about this subject in the comments section below.
Less Than 15,000 Blocks to Halving: ETF Hopes and Ordinal Inscriptions Serve as Life Preserver for Bitcoin Miners
As of Jan. 9, 2024, fewer than 15,000 blocks remain before the fourth Bitcoin halving event. This milestone will halve the block reward from 6.25 to 3.125 bitcoins per block. Expected to occur in April 2024, this event will render bitcoin increasingly scarce. However, it may exert considerable pressure on miners, seeing their earnings cut by 50% following the halving.
2 Key Trends Buoy Miners Ahead of 2024 Milestone
The Bitcoin halving event is approaching and is estimated to be just over 100 days away, assuming block times maintain their average of ten minutes. Current statistics, as of this writing, indicate that 14,981 blocks remain until the halving.
This upcoming event marks the fourth halving; the first occurred on Nov. 28, 2012, followed by the second on July 9, 2016, and the third on May 11, 2020. Before these halving epochs, especially preceding the 2016 and 2020 events, certain skeptics of bitcoin predicted a ‘mining death spiral’ accompanied by substantial miner capitulation.
In the past, bitcoin detractors have claimed that a mining death spiral could occur post-halving due to reduced block rewards. They argue that this decrease in profitability may lead to miners exiting the network en masse, resulting in a drop in hashing power, slower transaction times, and potential security vulnerabilities, thus destabilizing the entire Bitcoin network.
However, a 2020 research study by Coinshares dismissed these concerns as “highly theoretical edge cases without any historical real-world precedent.” As the 2024 halving nears, these once-prominent theoretical concerns have significantly diminished.
Up to this point, two key developments have enhanced the earnings of bitcoin miners: the anticipation of a U.S. spot bitcoin exchange-traded fund (ETF) approval and the burgeoning Ordinal inscription trend. Mining revenue saw a substantial rise throughout 2023 and this trend has persisted into the new year.
The positive sentiment surrounding the potential approval of a spot bitcoin ETF has boosted BTC’s value, consequently increasing the network’s hash price. The surge in activity, coupled with the popularity of Ordinal inscription minting, has significantly raised transaction fees. If these trends persist, miners might not experience a significant impact from these changes.
Although current fees are lower than last month, they remain notably higher than the same period last year. The potential approval of an ETF has led crypto enthusiasts to anticipate significant demand for bitcoin from these publicly traded funds, potentially maintaining BTC’s high price for an extended period.
As with previous halvings, the outcome remains uncertain, and bitcoin miners have historically operated under tight conditions. However, major mining operations with substantial capital are scaling up their hashrate significantly by acquiring thousands of advanced mining rigs.
With these more efficient miners and increased hashrate outputs, coupled with the potential price support from an ETF and higher fees due to inscriptions, bitcoin miners are expected to remain resilient, similar to their experience during the past three halving events.
What do you think about the upcoming Bitcoin halving event? Share your thoughts and opinions about this subject in the comments section below.
‘Controversial’ Bitcoin Proposal to Curb Inscriptions Ignites Fierce Debate, Ends Without Resolution
On Friday, Jan. 5, 2024, the debate surrounding Bitcoin developer Luke Dashjr’s proposal to restrict all varieties of data-bearing transactions concluded as the topic veered into “controversial” territory. Bitcoin Core custodian and Blockstream staff member Andrew Chow terminated the Github dialogue, marking it as a “stalemate discussion.”
Intense Dispute Over Bitcoin’s Data-Carrying Transactions Culminates in Discussion Lockdown
The recent surge in Bitcoin Ordinal inscriptions has riled up the developers responsible for the protocol’s codebase. In September 2023, Luke Dashjr spearheaded a new pull request (PR) named “datacarriersize: Match more datacarrying.” In essence, the proposal aims to amend the datacarriersize parameter in Bitcoin to cap all varieties of data-bearing transactions. Dashjr, along with the proposal’s supporters, contend that Bitcoin’s code inherently curbs spam, and this PR is merely extending an existing datacarriersize restriction to another type of data.
Following its introduction, the proposal elicited a wide array of responses, with some individuals expressing approval of the idea while others firmly believed it to be fundamentally flawed. Peter Todd remarked that the “transactions targeted by this pull-req are a very significant source of fee revenue for miners.” Todd added that it is unlikely that bitcoin (BTC) miners would give up the revenue. “Censoring those transactions would simply encourage the development of private mempools – harmful to small miners – while making fee estimation less reliable,” Todd emphasized.
Chris Martl offered a dissenting opinion to Todd’s argument, asserting that the primary impact would be on node operators who would face increasing expenses. “The transactions targeted by this pull-req. are a very significant source of prohibitive cost for regular node operators,” Martl contended. “It is very unlikely that regular node operators will give up mitigating that source of operative cost. Regular policy rule for these transactions would encourage the economical resource usage of mempools – not harming any miners – neither changing any fee estimation already on the field,” Martl explained.
Pieter Wuille, also known as “Sipa,” disagreed with Dashjr’s proposal and argued that it did not serve the interests of Core’s software users. Wuille said that engaging in transaction relay and maintaining a mempool is crucial for forecasting upcoming block compositions. Willfully omitting transactions, despite their “clear (however stupid) economic demand,” undermines this predictive capability, without even negating the necessity to validate them upon mining. Wuille added:
I believe the demand for [block space] many of these transactions pose is grossly misguided, but choosing to not see them is burying your head in the sand.
The debate intensified, with numerous voices asserting that these transactions did not constitute spam, while others vehemently argued the opposite. “It seems to me that the proposed change here is more harmful than beneficial,” Mark “Murch” Erhardt wrote in response to Dashjr’s proposal. “Except that most new node runners are Ordinals indexers, and inscribers. Ordinals are here to stay, fork off or accept it,” another person insisted. On Friday, Bitcoin maintainer and Blockstream employee Andrew Chow shut the conversation down.
“It’s abundantly clear that this PR is controversial and, in its current state, has no hope of reaching a conclusion that is acceptable to everyone,” Chow said. “At this point in time, I see no reason to leave this open and to continue to send notifications for the constant back-and-forth stalemate discussion.” The discussion was then locked for being “too heated and limited conversation to collaborators.”
As the dust settles on the intense debate around Dashjr’s proposal to limit data-bearing transactions in Bitcoin, the development community stands divided. With voices raised high from both supporters and detractors, the conversation’s abrupt closure by Chow underscores the complexity and passion embedded in Bitcoin’s ongoing evolution. The discussion, though halted, leaves an indelible mark on the narrative of Bitcoin’s development and the diverse community that surrounds it.
What do you think about the discussion concerning Dashjr’s proposal and the conversation getting locked over being too heated? Share your thoughts and opinions about this subject in the comments section below.
Elon Musk Criticizes NFTs, Gives Nod to Inscriptions: ‘At Least Encode the Jpeg on the Blockchain’
Elon Musk, the chairman of X, has referred to non-fungible tokens (NFTs) and the defects of their implementation, indirectly making the case for inscriptions. Answering a post on X on the topic of NFTs, Musk suggested saving the jpeg (an image format) of the NFT on the blockchain, like inscriptions are currently saved on Bitcoin.
Elon Musk Indirectly Nods at Ordinal Inscriptions
Elon Musk has given indirect support to Ordinal inscriptions, a series of images and other data saved on the BTC blockchain. In an X post commenting on the issue of non-fungible token (NFT) data, and how it can be linked to content not owned by the issuers, that can be removed, Musk declared:
Yeah, at least encode the jpeg on the blockchain!
Musk’s complaints about how standard NFTs work are not new. On the Joe Rogan Experience podcast, Musk stated:
The funny thing is the NFT is not even on the blockchain — it’s just a URL to the JPEG.
As Musk explained, earlier NFT implementations featured a link to the content highlighted in the file that led to a website, something that was pointed out by critics of the NFT mania back in the day. However, Ordinal inscriptions and Stamps, two recently introduced protocols, allow users to save the desired media directly on top of the Bitcoin blockchain, securing the longevity of the file.
The rise of these inscriptions has raised discussions on what constitutes a “fair use” of the blockchain space, with some mining pools even opting to filter transactions containing them, considering these inscriptions “spam.”
The post that started the discussion featured a video and a song about NFTs that Musk also posted in 2021. Leonidas, a co-founder of Ord.io, later reported this video was inscribed on Bitcoin by an unknown user who paid ,223 in fees to this end. The file, identified as Inscription 51,887,020, has a size of 366.57 KB.
What do you think about Elon Musk’s views on NFTs? Tell us in the comments section below.
Will Inscriptions On Polkadot Push DOT Prices Back Above $10?
There has been a notable spike in the number of Polkadot transactions in recent days. The surge also coincides with DOT prices racing to new 2023 highs when writing on December 22.
Taking to X, asynchronous rob noted that Polkadot is currently processing around 250,000 transactions per hour or 400-450 per block. Polkadot is a modern blockchain that aims to drive blockchain interoperability.
Based on its design, relying on a Relay Chain and numerous Parachains, the network can process transactions cheaply, considering its high capacity.
Polkadot Transactions Swelling: Blame Dota and Inscriptions
The rapid expansion of transactions on Polkadot can be attributed to the recent launch of inscriptions, a new type of cross-chain asset developed by the Dota platform. Uniquely, Dota’s inscriptions aim to simplify the process of deploying and minting assets on Polkadot’s parachains.
Though parachains operate independently as “chains” that rely on the Relay Chain for security, this design will eliminate the need for Cross-Chain Message Forma (XCM), which is needed for Polkadot parachains to communicate.
Usually, the XCM requires complex coding and can be time-consuming. Therefore, the simplicity of DOT-20 inscriptions by Dota directly explains why there is a surge in the number of transactions.
According to Dota on X, inscriptions on Polkadot account for 98% of the recent transaction volume.
Though there has been a change in the number of transactions processed, transaction fees on Polkadot remain low. At the same time, the network hasn’t “skipped a bit,” with capacity being around 10%.
By how Polkadot is designed, network fees will increase only once 25% of the total network capacity is changed. To reach this level, each block being confirmed on Polkadot must pack at least 1,250 transactions.
This will require even more inscriptions to be created via Dota, meaning despite the observed spike, Polkadot is technically underutilized from a bandwidth perspective.
Will DOT Continue Rising In 2024?
While the deluge of transactions also coincides with rising DOT prices, currently at 2023 highs, there have been concerns about inscriptions causing network congestion in a network like Bitcoin facing scaling challenges.
Critics maintain that inscriptions, though defended by some, serve nothing more than spamming the network and discouraging use due to accompanying increases in transaction fees.
For now, it remains to be seen if inscriptions will be sustainable, helping onboard more users. So far, Polkadot, as mentioned, can handle the uptick in transactions.
Even so, if there is a 3X rise in transactions exceeding the 1,250 transactions per block threshold, the demand for DOT will rise. Subsequently, DOT will likely trend higher towards and other critical resistance levels.
Adam Back States ‘You Can’t Stop JPEGs on Bitcoin,’ Proposes Block Size Increase to Host Inscriptions
Adam Back, CEO of Blockstream and legendary cryptographer, has acknowledged that inscriptions, media embedded directly on top of Bitcoin, cannot be stopped, stating that any action focused on this will only prompt users to do it in “worse ways.” Instead, Back proposed adding a new blob of data to Bitcoin blocks dedicated to inscription purposes.
Adam Back Proposes Block Size Increase to Support Inscriptions
Blockstream CEO Adam Back recognized that fighting Ordinal inscriptions, media embedded directly on the Bitcoin blockchain, is useless. In recent statements posted in X, Back stated that JPEGs (images) on Bitcoin were unstoppable and that any actions directed to stop them would only worsen the situation.
Back declared:
Complaining will only make them do it more. trying to stop them and they’ll do it in worse ways. the high fees drive adoption of layer2 and force innovation. so relax and build things.
Back has been critical of the Ordinals protocol and its purpose since its launch, calling it “inefficient” and “stupid,” prompting developers to use other solutions like IPFS to achieve the same objective.
The issuance of Ordinal inscriptions and stamps, another media embedding protocol on Bitcoin, recently took transaction fees to over . According to Back, a solution to this congestion issue can come in the way of allocating space directed to host this and other Bitcoin-centric data through a “segwit annex” to each block. He explained:
Inscriptors want unavoidable scarcity derived from bitcoin mining and blockspace limits, and they want to pay less not more. so a segwit annex for another 4MW space, paid by miners, with a higher discount than taproot inscriptions.
Back acknowledged this proposal would include a Bitcoin block size increase that would not be required for consensus and would also be used to save Bitcoin wallet-related data.
Many users in the community signaled that Back’s proposal resembled Ethereum EIP-4844, also known as Proto-Danksharding, which adds data blobs with a limited life to the Ethereum blockchain, which also have their own fee market.
What do you think about Adam Back’s “segwit annex” block size increase proposal for Ordinal inscriptions? Tell us in the comments section below.
Bitcoin Celebrates One Year of Ordinal Inscriptions With 48 Million Mark Hit, Signaling Longevity Despite Ongoing Debate
On Dec. 15, 2023, a significant milestone was achieved in the Bitcoin blockchain world, just a day shy of the anniversary of the first Ordinal inscription. The total count of Ordinal inscriptions has impressively hit the 48 million mark. Despite initial skepticism about their longevity, these inscriptions have not only persisted but now make up half of all BTC transactions confirmed daily.
Bitcoin Marks 1st Anniversary of Ordinals: 48M Milestone Achieved
2023 has seen Ordinal inscriptions gain immense traction, significantly impacting Bitcoin’s ecosystem and vying with other blockchains in the non-fungible token (NFT) space. This journey began almost a year prior, on Dec. 16, 2022, marking the creation of the first-ever Ordinal inscription on Bitcoin’s distributed ledger.
These Ordinal inscriptions are a sophisticated process that transforms a satoshi, Bitcoin’s smallest unit, into a distinct digital asset. Key network upgrades, notably the Segregated Witness (Segwit) protocol in 2017 and the Taproot upgrade in 2021 have been instrumental in making these inscriptions viable.
Particularly, Taproot’s introduction enabled more intricate transactions and the integration of additional data within a transaction. The essence of the Ordinal inscription process lies in embedding the digital asset’s data into the transaction’s witness section, thereby converting satoshis into unique, non-fungible entities.
This innovative process has also facilitated the creation of fungible tokens, known as BRC20s. As of now, on the eve of the first inscription’s anniversary, a total of 48,054,267 inscriptions have been recorded on the chain.
In terms of monetary value, miners have amassed approximately 3,697.38 BTC, equating to 8.36 million, for verifying these inscriptions. The surge in inscriptions has propelled Bitcoin’s daily transaction count to new records.
Notably, on Nov. 19, 2023, the network saw over 710,000 transactions in a single day. Additionally, a record-breaking day on Nov. 12 witnessed over 505,000 Ordinal inscriptions. Currently, inscriptions account for an estimated 40-50% of the daily transactions processed by bitcoin miners.
The introduction of Ordinals and BRC20s has sparked controversy within the Bitcoin community. A segment of Bitcoin enthusiasts argues that the blockchain should exclusively host financial transactions.
This debate has intensified, especially with Luke Dashjr’s Ocean Pool beginning to exclude inscriptions from its mining block template. While Ordinals have indubitably left their imprint in their first year, the debate over their place in the Bitcoin ecosystem remains heated.
The increase in onchain BTC fees and persistent congestion in the mempool due to unconfirmed transfers have been notable side effects of the inscription trend. At press time, more than 200,000 unconfirmed transactions are waiting for confirmation from miners. On Dec. 6, 2023, the average onchain transfer fee reached .55.
In the realm of NFT sales, Bitcoin has emerged as a strong competitor against other blockchains, even surpassing Ethereum in NFT sales in November. This trend continued into early December, with seven-day figures showing Bitcoin NFT sales at 9 million, doubling Ethereum’s million.
Additionally, according to cryptoslam.io, six of the top ten NFT collections in weekly sales are Bitcoin-based. One of the most expensive NFT sales on Bitcoin this week was a Van Gogh painting embedded to the blockchain.
What are your views on the 2023 trend of Ordinal inscriptions? Do you favor the concept of inscriptions, or do you think Bitcoin should be reserved solely for financial transactions? We welcome your thoughts and opinions on this matter in the comments section below.
Bitcoin Developer Luke Dashjr Registers Ordinal Inscriptions Workaround as a Vulnerability
Luke Dashjr, Bitcoin developer and CTO of Mummalin, has registered a method that allows Ordinal inscriptions to be saved on the Bitcoin blockchain as a code vulnerability. The vulnerability, CVE-2023-50428, states that “datacarrier size limits can be bypassed by obfuscating data as code,” as Ordinal inscriptions do to embed images and other kinds of data directly onto the BTC blockchain.
Luke Dashjr Registers Bitcoin Vulnerability CVE-2023-50428
Luke Dashjr, Bitcoin developer and CTO of Mummalin, the company behind the Ocean mining pool, has registered the method that allows Ordinal inscriptions to embed data directly on top of the Bitcoin blockchain as a vulnerability. The vulnerability, registered as CVE-2023-50428, describes how the Ordinals protocol allows this data to be obfuscated and embedded into the chain.
The description of the so-called vulnerability explains:
In Bitcoin Core through 26.0 and Bitcoin Knots before 25.1.knots20231115, datacarrier size limits can be bypassed by obfuscating data as code (e.g., with OP_FALSE OP_IF), as exploited in the wild by Inscriptions in 2022 and 2023.
The National Institute of Standards and Technology’s (NIST) National Vulnerability Database (NVB), which hosts a copy of the Common Exploits and Vulnerabilities (CVE) list, gives this exploit a 5.3 score, identifying it as a “medium” threat.
Dashjr, who has already stated that Ordinal inscriptions are a bug and expects to get the issue fixed in the next release of the Bitcoin Core full node software, is facing enormous criticism from the Bitcoin community.
Other developers have conceptually rejected the fix for this “vulnerability,” already proposed as a patch for Bitcoin Core in September. Peter Todd, a Bitcoin Core developer who opposes this change, explained that:
It is very unlikely that miners will give up that source of revenue. Censoring those transactions would simply encourage the development of private mempools – harmful to small miners – while making fee estimation less reliable.
In the same way, Bitcoin contributor Sjors Provoost stated that the approach taken by Dashjr “does not create an incentive to use a slightly less harmful method to post ‘spam,’” encouraging programmers to find more innovative ideas to avoid the proposed filter.
Ocean, a Bitcoin mining pool, uses a fork of Bitcoin Core developed by Dashjr, called Knots, which has been criticized for censoring Samourai Wallet’s private transactions after applying this fix targeting Ordinal inscriptions.
What do you think about the Bitcoin CVE-2023-50428 vulnerability? Tell us in the comments section below.
Bitcoin Developer Luke Dashjr States Inscriptions Are Exploits, Hints at Future Fix
Luke Dashjr, bitcoin developer and Mummolin’s CTO, has reiterated his negative opinion about Ordinal inscriptions, stating these leverage and exploit a vulnerability in the Bitcoin Core full node software implementation. Dashjr also hinted at correcting this “exploit” in an upcoming version of the Bitcoin node software.
Luke Dashjr Divides BTC Community, States Inscriptions Could Be ‘Fixed’
Luke Dashjr, a Bitcoin Core software developer and CTO of Mummolin, the company that operates the Ocean bitcoin mining pool, has criticized Ordinal inscriptions, a series of elements — images and others — that can be directly embedded onto the BTC blockchain.
Dashjr, who has been very vocal about his negative opinion of these inscriptions, referred to them as “spam” and as “exploits,” revealing that he had already fixed this “bug” in Bitcoin Knots, a node software maintained by himself.
Dashjr explained:
This bug was recently fixed in Bitcoin Knots v25.1. It took longer than usual due to my workflow being severely disrupted at the end of last year (v24 was skipped entirely).
Ocean, the recently launched bitcoin mining pool that acknowledged having filtered inscriptions since day one, also implemented this Knots fix, making inscriptions unable to be included in blocks mined by the pool.
Furthermore, Dashjr hinted at the possibility of introducing a similar fix in an upcoming version of Bitcoin Core, the default full-node software of the Bitcoin network. “Bitcoin Core is still vulnerable in the upcoming v26 release. I can only hope it will finally get fixed before v27 next year,” he declared.
Several members of the Bitcoin community rejected this possible change. Jameson Lopp, co-founder and CTO of Casa, stressed that mining had a significant economic element now and that his proposal was unlikely to stand. “Miners are mostly large enterprises now. They have a duty to maximize profit for shareholders. They will mine any valid transaction that pays the highest fee rates,” he concluded.
Udi Wertheimer, a co-founder of Taproot Wizards, one of the largest inscriptions projects, stated that while Dashjr had made “sporadic contributions” to Bitcoin projects, he was not Bitcoin’s owner.
What do you think about Luke Dashjr and his take on inscriptions? Tell us in the comments section below.