According to Web3 data platform CryptoSlam, Bitcoin NFTs have climbed to the second position in NFT sales per blockchain.
The data also reveals that Bitcoin NFTs have generated approximately $170 million in the last thirty days, falling short of Ethereum’s impressive sum of nearly $392 million. When compared to the Solana network, Bitcoin’s NFT sales are nearly three times greater, amounting to around $54 million.
The success of Bitcoin NFTs can be attributed to the Ordinals Protocol, which enables embedding data, such as a JPEG, into Satoshis, the smallest unit of Bitcoin.
Despite criticism from the Bitcoin community, NFT powerhouse Yuga Labs introduced its collection based on the Ordinals Protocol in February. This move generated considerable traction in investment, further driving the adoption of this technology.
Per CryptoSlam data, Bitcoin Frogs is the leading Bitcoin-based NFT collection, with sales totaling $5.7 million in the last seven days. This collection recently experienced a surge in popularity, with a sales figure of $2.3 million on May 17.
The implementation of #Bitcoin ordinals spurred NFT activity on $BTC.
Over the past 30 days #Bitcoin has seen the second most NFT sales volume among all blockchains:
h/t @cryptoslamio pic.twitter.com/q8qnHCcLfD
— Osprey Funds (@OspreyFunds) May 23, 2023
BRC-20 responsible for most of ordinals activity
Based on data from Domo’s Dune dashboard, BRC-20 token transactions were responsible for the majority of ordinals activity observed on the Bitcoin network.
The BRC-20 token standard, developed using ordinals, is an experimental fungible token standard. It has garnered significant attention for its association with memecoins.
As the excitement surrounding BRC-20 memecoins gained momentum, their overall market capitalization surpassed the significant milestone of $1 billion in the initial weeks of May. The market capitalization of BRC-20 tokens currently stands at $447 million.
BRC-20 tokens such as ORDI, PEPE and MEME have gained popularity despite lacking inherent utility and being primarily issued as experimental tokens. ORDI, for example, was created by Twitter user Domo to demonstrate the functionality of BRC-20 using ordinals.
DO YOU SEE THIS?
Bitcoin Ordinals trading volume UP 35% in 7 days and
Bitcoin volume reaching 37% of ETH's volume when you subtract $93M in wash trading on ETH
Data by @cryptoslamio
The reverse flippening is coming! pic.twitter.com/EvYRxITbfJ
— trevor.btc @ NYC (@TO) May 15, 2023
BRC-20 token’s controversy
BRC-20 tokens and ordinals have generated debate and controversy among the crypto community. Firstly, there are concerns about network congestion and the subsequent increase in transaction fees caused by the proliferation of these tokens.
Secondly, some argue that BRC-20 tokens and ordinals introduce “pollution” to the blockchain by incorporating data that deviates from Satoshi’s original vision of a peer-to-peer system for monetary transactions.
Bitcoin maximalists, in particular, criticize any utilization of the Bitcoin blockchain that diverges from its intended purpose.
In contrast to NFTs on Ethereum that store files on external servers, ordinal NFTs on Bitcoin are designed to include the complete data file within the witness signature field of Bitcoin transactions. This process ensures that all the information associated with the NFT is stored directly on the blockchain itself.
As a result, ordinal NFTs offer greater immutability than other NFTs, enhancing the integrity of the asset. However, this advantage comes with a trade-off — the size of ordinal NFTs can be significantly larger.
Bitcoin Core developer Luke Dashjr said that the large file sizes associated with ordinals could be viewed as an “attack” on Bitcoin due to the resulting network congestion.
Meanwhile, some have highlighted that miners, who have been grappling with various difficulties arising from the bear market, including notable bankruptcies, have greatly benefited from the surge in BRC-20.
Bitcoin miners are earning more money from processing blockchain transactions than mining new BTC, thanks to the rise of BRC-20 tokens and ordinals. This can help offset the decreasing profitability of Bitcoin mining caused by halving and reduced mining rewards.
