Crypto firm Grayscale is optimistic about Bitcoin Ordinals

The crypto firm Grayscale penned a post outlining why Bitcoin Ordinals could be a good signal for BTC

Published: May 2, 2023 03:58:19 PM IST

Updated: May 2, 2023 05:21:51 PM IST

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Also called Bitcoin NFTs, Bitcoin Ordinals, started in December 2022, has been inviting opposing views in the crypto space. The crypto firm Grayscale has recently opened up on the same, stating that Bitcoin Ordinals represent a huge opportunity for Bitcoin adoption and could be an area of optimism.

Those opposing Bitcoin Ordinals believe it could harm fungibility or bloat the blockchain. On the other hand, Grayscale believes that it could be an improvement to the Bitcoin network perceived to be rigid.

Referring to the opposing views regarding Bitcoin Ordinals, Grayscale stated that even though the concerns were valid, and the original Bitcoin whitepaper did not account for unique digital assets, inscriptions that could reduce fungibility or extra data contributing to blockchain bloat, “Still, ordinals are, in fact, a byproduct of utilizing the Bitcoin blockchain as it exists today and the subsequent crypto innovations that have come since, even if not initially envisioned by Bitcoin's creator."

The crypto firm Grayscale then went on to detail two opportunities presented by Bitcoin Ordinals which could be beneficial for the Bitcoin network. Firstly, it said that the Bitcoin NFTs could help increase fees for Bitcoin miners.

Grayscale mentioned how, once all tokens were mined, miners would not be able to maintain the required hash rate for securing the network since they won't derive enough rewards from the transaction activities. But Bitcoin Ordinals have helped in increasing the fees of such miners, which would enable them to maintain the level of security across the Bitcoin network forever.

Grayscale also believes Bitcoin Ordinals could be instrumental in driving Bitcoin adoption by bringing a transformational change to the culture of the Bitcoin community. With increasing NFT adoption on the network, a development-led culture could be established like that in Ethereum.

This could be a big change from its stagnant perception from certain quarters. Ordinals witnessed daily inscriptions going to 300,000 on April 30, while Bitcoin transactions have also increased.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash