– Earlier this year, Ordinals — a unique inscription on the smallest unit of a Bitcoin, called a Satoshi — emerged as a controversial new development.
– The technology stimulated a flurry of developments, including excitement around “recursive inscriptions”.
– Recursive Inscriptions promise to allow more complex functionality to be built on Bitcoin’s blockchain, akin to smart contracts on Ethereum.
– Some believe recursive inscriptions could see Ordinals develop from NFTs and “digital artifacts” to underpin a full-blown DeFi ecosystem on Bitcoin very soon.
– Others are confident it will enable Bitcoin to take on decentralized storage provider IFPS. One person interviewed believes it will eventually lead to an interconnected supercomputer being built on-chain.
– Recursive inscriptions were switched on in June, and have since been used in various Bitcoin projects.
What are Ordinals and recursive inscriptions?
– Ordinals allow you to uniquely identify a satoshi or a sat.
– Identifying a fractionalized part of a Bitcoin means creating NFTs on Bitcoin or creating a provenance certificate on-chain is now possible.
– The idea of NFTs on Bitcoin is tantalizing for some. In January 2023, developer Casey Rodarmor released the Ordinals protocol, creating Bitcoin NFTs on the Bitcoin blockchain.
– The Ordinals protocol utilizes an unintended loophole in the taproot scripts of Bitcoin code to create unique NFTs and digital artifacts stored on the Bitcoin blockchain.
– Ordinals allow you to store any type of data on the most decentralized blockchain, and no one can modify it.
– Recursive inscriptions, also known as programmable inscriptions, enable smart contract-like functionality and more complex processes to be built on Bitcoin blocks.
– Recursive inscriptions use existing inscribed data to build upon and can be thought of as data legos. They cut down on storage requirements and enable new types of applications and experiences on Bitcoin.
Recursive inscriptions = Bitcoin cloud computing
– Recursive inscriptions can function like a distributed data repository, like putting AWS cloud on Bitcoin.
– Recursive inscriptions enable hosting even complex data sets like video and audio files on Bitcoin. With a one-time cost to inscribe, data could be hosted forever on the most immutable and decentralized network in the world.
– Recursive inscriptions use data inscribed elsewhere on new inscriptions, cutting down on storage requirements.
– This opens up possibilities for applications like on-chain AI and creates an interconnected supercomputer living on Bitcoin.
Let’s start with DeFi and AWS first
– Recursive inscriptions and smart contracts on Bitcoin are allowing for the emergence of Bitcoin DeFi, competing with Web3 data storage providers like IPFS.
– Decentralized data storage on Bitcoin could disrupt NFT culture by allowing images, text files, and audio files to be directly stored with tokens.
– Bitcoin-native DeFi products are becoming a realistic prospect now and Bitcoin’s blockchain can be used as the layer-1 base.
– Bitcoin can be linked up to other layer-2 applications to enable smart contracts and complex financial applications.
New generation of Bitcoin maxis?
– Developers are flooding into the Bitcoin ecosystem, eager to build NFT marketplaces, DeFi protocols, and more.
– The release of the Ordinals protocol has attracted developers to Bitcoin and opened up a new era of development.
– Bitcoin is no longer just a currency, it is becoming a DApp store.
– The use cases for recursive inscriptions and smart contracts on Bitcoin are highly speculative, but they are driving excitement and innovation in the Bitcoin community.
– Bitcoin’s brightest days may lay ahead as developers play a key role in shaping its future.