“Bitcoin will heal itself. Satoshi is alive. Core will heed the call and fix the Ordinals bug in due time. If that is Satoshi’s will.” – Max Keiser
The total of Ordinal inscriptions on the Bitcoin blockchain hit a whopping 48 million on December 15, representing approximately half of all BTC transactions daily. Earlier in the month, Sotheby’s announced it would be auctioning off Bitcoin Ordinals.
Ordinals is a protocol for issuing NFTs and alternative tokens on the Bitcoin network – a feat most thought impossible. Bitcoin Ordinals are pure NFTs and exist as native resident immutable inscriptions on the Bitcoin blockchain, which leads to the clogging of the network. Contrarily, most NFTs at the current juncture are links or references to externalized artifacts. They are therefore light on space usage.
Bitcoin Ordinals Debate: Innovation or Disruption? Sparks Fly in Cryptocurrency Arena
These Bitcoin-based NFTs have come with their fair share of controversy, even threatening to break apart the Bitcoin community through yet another hard fork. Bitcoin hard forks happen when a chain “forks” into two distinct chains due to disagreement over the protocol rules.
If the debate over Bitcoin Ordinals does indeed lead to another Bitcoin fork, it will likely look a lot like the last one. Proponents of Ordinals, which could include Bitcoin miners, might decide to create a competing Bitcoin Chain–Bitcoin Ordinals–which can experiment with larger block sizes and all the complex functionalities that come along with it. Not only might there be Ordinals on the theoretical Bitcoin Ordinals blockchain, but stablecoins, tokens, and more.
Bitcoin Cash (BCH) is a Bitcoin fork designed to increase the block size for faster transactions, as well as Bitcoin Satoshi’s Vison (BSV), which sought to expand Bitcoin’s scalability.
Critics of Ordinals, such as “Bitcoin’s High Priest” Max Keiser and OCEAN CTO and Bitcoin core developer Lukedashjr, dismiss Bitcoin Ordinals as spam on the Bitcoin network. The core developer team even assigned Bitcoin Ordinals the identifier CVE-2023-50428, recording its qualification as a vulnerability (“incomplete pattern matching”) by the devs for “wasted resources/DoS.”
“Inscriptions” are exploiting a vulnerability in #Bitcoin Core to spam the blockchain,” LukeDashjr wrote in a post to X, noting that the “bug” had been “fixed” in OCEAN’s latest upgrade.
Furthermore, Jack Dorsey’s newly launched Bitcoin (BTC) mining pool, OCEAN, updated its mining software to exclude Bitcoin ordinals transactions from the blocks that it generates. Adam Back, CEO of Blockstream, a blockchain technology company, said that Bitcoin advocates “can’t stop JPEGs on Bitcoin.” In El Salvador, Ordinals are considered securities.
Luke Dashjr argues that Ordinals takes advantage of a vulnerability recently fixed in the Bitcoin Core fork Bitcoin Knots. His view is that the vulnerability allowed Ordinals to get around Bitcoin’s limits for extra data in transactions. It does this by obfuscating inscription data as program code.
Bitcoin core developers are planning to make changes in Bitcoin Core v27 which could repair the perceived bug. The pending change in Bitcoin Core v27 stops new Ordinals from being minted. Existing Ordinals would remain.
As powerful camps dig in to their respective position–pro or against Ordinals inscriptions–it seems history is beginning to repeat itself. The Bitcoin block size debate broke out in 2016. In August 2017, the last BTC fork occurred as a result of that debate, resulting in Bitcoin Cash. The current discussion revolves around very much the same issues–transaction throughput.
This growing debate could lead to a Bitcoin fork. The last Bitcoin fork was August 2017 when Segregated Witness (SegWit), a change in Bitcoin’s transaction format where witness information was removed from the input field of blocks, was rolled out amid much controversy, especially on the Bitcoin subreddit and BitcoinTalk, the bitcoin forum started by Satoshi Nakaomoto.
When it comes to any hard forks due to inscriptions, miners are making money on Bitcoin Ordinal fees, so they might not go along with any plans devised by Bitcoin’s Core developer team. With that said, miners naturally aren’t the ultimate arbiters of whether to adopt any such changes.
When Ordinals became popular early in 2023, the online Bitcoin community was soon torn on whether ordinals were a net benefit for the network thanks to the new applications it provides or a burden due to using the network for purposes it was not intended for.
Read Also: Yuga Labs’ TwelveFold Bitcoin NFT Collection Auction Nets $16.5M
Proponents of Bitcoin Ordinals are interested in how the protocol can be used to expand Bitcoin’s use beyond financial transactions. The Bitcoin Ordinal use case could also be applied to securities tokens or stablecoins, bitcoin-based smart contracts, and more–all on the Bitcoin blockchain.
The Bitcoin Core developers have likely been debating how to fix the perceived Ordinal bug already. Such technical debates take time to resolve. They likely have two legitimate options. One is to increase Bitcoin block size, which seems unlikely considering Bitcoin developer reluctance to do so in the past during the 2015-2016 bitcoin block size debate. They can also try to push a “fix” at the protocol level, but that could result in a hard fork splitting BTC into two or more chains.
What’s for sure is that the opponents of Bitcoin ordinals are fervent. The developers won’t sit on the sidelines as Ordinals have a considerable impact on network dynamics, which they perceive as a protocol issue.
Read Also: Magic Eden Launches Bitcoin Inscriptions Launchpad for Creators