This is an op-ed by Bitcoms, a Bitcoin writer.
“Bright, fast things blur it out.”
-William Shakespeare, “A Midsummer Night’s Dream“
“engravingsIt is a method of writing arbitrary bits of information onto the Bitcoin blockchain.ordinalis a convention used to track individual sessions and associate them with patterns. This article does not attempt to argue for or against Bitcoin ordinal patterns.
It deals with a widespread fallacy that ownership of ordinal patterns is enforced and protected by the rules of the Bitcoin protocol itself (I stress that it is not). And while this fallacy may be double-emphasized or innocent, it is always harmful because it can make ordinal inscriptions more attractive to potential buyers.
Here is a typical example:
“Ordinal values allow a variety of data, including text, images, and videos to be included on a single satoshi (the smallest denomination of Bitcoin) and permanently stored on the Bitcoin blockchain.”
–Introduction documents for Ordinals market
This indicates that the ownership of any token will be protected by the permanence and immutability of the Bitcoin time chain itself. But Bitcoin does not enforce ownership of the patterns, because the pattern is not “recorded to one satoshi” on the blockchain at all.
like “Ordinal theory handbookOrdinal theory guide Collected by its developerspointing to:
“Satoshis live in outputs while “The content of the inscription is included in the transaction witnesses. “
while both output data And Witness data Stored on the Bitcoin blockchain after SegWit’s upgrade, claiming that the registration data is closely linked to the “listed” Satoshi creates the misleading idea that any such link is recognized by Bitcoin itself.
In fact, the link between Pattern and a specific Satoshi is manufactured off-chain by a A purpose-built external indexer. This pulls data from the Bitcoin blockchain and displays it according to an elegant yet centralized and arbitrary system of rules called “ordinal theory.” These rules are completely alien to the Bitcoin protocol itself, and were described by its creator as closer to astrology.
The spread of the inscription fallacy
But in my opinion, the data in many places where ordinal inscriptions can be created, displayed, bought, and sold, as well as in media coverage, do not explain the role of the ordinal cataloger clearly enough. Thus, the notion that the patterns are embedded “on” or “directly” into Satoshi, and that the pattern and corresponding satellite data are closely linked to the Bitcoin protocol without the need for an external indexer, has created a dangerous fallacy for potential investors.
Here are some examples of these statements:
“Ordinal tokens, similar to NFTs, are digital assets listed on Satoshi, the lowest denomination of Bitcoin.”
“…ordinal elements are ‘engraved’ on a single satoshi… Notation is the process of placing a piece of data on the blockchain, where it will remain accessible and immutable forever.”
“Each session can be logged with data, such as JPGs, GIFs, PDFs, and more, generating a Bitcoin Ordinal which is then held in the wallet.”
What is ordinal bitcoin? Launched in January 2023, it allows NFTs to be created on the Bitcoin blockchain by attaching data to an individual satoshi using a process called engraving.
“For non-private ordinal vouchers, similar to NFTs, are digital assets listed on satoshis (the smallest unit of currency in bitcoin).”
“Ordinal records a serial number on the satoshi, the smallest unit of currency in bitcoin.”
“Ordinal elements are recorded directly on individual satoshis, which are then included in blocks on the Bitcoin blockchain.”
“… Bitcoin network upgrades… made it possible for each Satoshi… to store a few megabytes of data, from text and images to audio and video.”
“The functions of the token… are all achieved by recording the data in satoshis, the smallest divisible unit of Bitcoin.”
As mentioned at the beginning, this article does not seek to show that ordinal inscriptions are good or bad. It simply highlights the misleading, sometimes dirty, and maybe sometimes disingenuous ways in which it is presented, falsely suggesting that Bitcoin itself will enforce registration ownership without the use of an external tool.
So, what can be done to ensure that potential buyers of ordinal inscriptions do not fall victim to this fallacy? We can continue to clear up the confusion by pointing it out.
This is a guest post by Bitcoms. The opinions expressed are entirely their own and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.