For over a decade, the main narratives surrounding Bitcoin (BTC) have focused on its role as a peer-to-peer digital currency and store of value.
However, everything indicates that we are witnessing a significant shift in this paradigm.
Since the start of 2023, one of the most discussed topics in the Bitcoin ecosystem has been the use of the world’s leading blockchain to store information that goes beyond the previously mentioned use cases.
If you’ve been isolated in an igloo during this crypto winter and aren’t up to date with the developments, here’s a quick overview.
In January 2023, developer Casey Rodamor introduced the world to Ordinals, a protocol that allows you to permanently write any file to the Bitcoin blockchain.
It was not the first method created for such action, but it was the one that gained the most popularity, creating a trend where non-fungible token (NFT) Collections, music, video games, journalistic articles and even WikiLeaks archives began to be stored eternally and immutably on the world’s largest decentralized network.
“A group of anonymous activists is in the process of including Afghan war diaries published by WikiLeaks in #Bitcoin to protest against the imprisonment of Julian Assange’ @BitcoinMagazine #FreeAssange https://t.co/1huZ6J9SDM
-WikiLeaks (@wikileaks) October 23, 2023
As a result, experiments, innovation, and the prospect of the Bitcoin network as a vast decentralized database began to simmer.
Although less than a year old, the Ordinals protocol has remarkably evolved to become more efficient and enable bolder use cases.
One of the notable improvements is the recursive entries technique, which allows users to bypass the storage limit of 4 megabytes per block, allowing larger data to be inserted onto the Bitcoin blockchain.
As an example – illustrated by the image below – I listed an entire Cointelegraph article on Bitcoin using recursive listing.
A total of eight entries were made to obtain the final result, for a total file size of 5.22 kilobytes. (It’s small.) Seven of the inscriptions were images of the article, each stored individually in a Satoshi via the Ordinals protocol. The eighth inscription includes code that contains the text of the article and issues requests to retrieve the images of the other Satoshis.
This assembly allowed the complete article to be recorded eternally on the Bitcoin blockchain, a feat that could not have been achieved in a single step while preserving quality.
Leonidas, a developer within the Ordinals community, offered an even deeper perspective on the matter on Twitter, writing:
What if many people uploaded many packages of code to the Bitcoin blockchain? So now there is a huge repository of packages for developers to build on. This would unlock powerful use cases that could never be accommodated in less than 4 MB. The most complex software is, after all, just a collection of codes compiled together. It now becomes possible to put a complex 3D video game entirely on-chain on Bitcoin.
WTF, are these recursive registrations?
Here’s everything you need to know:
Earlier this year, the Ordinals protocol introduced the ability for anyone to write files entirely on-chain to Bitcoin. These registrations are self-contained and ignore other files that had been… pic.twitter.com/O3jt6lhaxT
– Leonidas (@LeonidasNFT) June 12, 2023
With just this, a world of possibilities can be contemplated and reinvented. After all, the opportunity to use the world’s leading blockchain as an immutable, shared, and uncensored data store is huge.
But the innovations don’t stop there!
In October, Lightning Labs announced the first mainnet release of Taproot Assets (TARO)further enhancing the Bitcoin blockchain as a multi-asset network.
Announcing the first mainnet release of Taproot Assets, a protocol for assets on #bitcoin and lightning.
With this release, developers can issue financial assets on-chain in a scalable manner.
Today marks a new era of multi-asset bitcoin. https://t.co/2cNvZSvv8v
– Lightning Laboratories⚡️ (@lightning) October 18, 2023
This couldn’t have happened at a more opportune time, considering the excitement surrounding Ordinals Protocol and how it has paved the way for TARO to shine alongside it.
The Ordinals protocol has broadened the perspective of users and builders, allowing them to build and visualize Bitcoin as a network of multiple assets.
Ordinal Assets – flooding the network with transactions – forced Binance to implement an integration with Lightning. This key factor, combined with low costs, decentralization and high settlement speed of the network, makes trading other coins and assets very attractive through Taproot Assets.
And among the different applications of the TARO protocol, one of the most talked about is the possibility of issuing stablecoins on the Bitcoin blockchain.
The paradigm shift is monumental as it paves the way for Bitcoin to transform from a tradable asset to a means by which exchanges take place.
This innovation will allow manufacturers to import successful use cases from other channels and bring them back to the mothership.
Some even joke that all other chains are just Bitcoin test networks. Does this all bring us back to Bitcoin?
THE BITCOIN RENAISSANCE CANNOT BE STOPPED
the magicians of @lightning labs are back with an efficient protocol for tokens in addition to bitcoin
Ethereum was a testnet. rise soon, we’re going to the moon pic.twitter.com/2g6vPFBAbV
– Udi Wertheimer (@udiWertheimer) May 16, 2023
Overall, we could say that we are at the dawn of a new Bitcoin era – the era of the multi-asset orange network.
In addition to attracting and retaining more developers who may be interested in these new protocols, these new applications also have the potential to attract and retain new users who initially did not find interest or value in Bitcoin as a store of value.
For some, transforming the world can sometimes be done through the simple pleasure of fun, cryptic sports cards. But with the optimization of Ordinals, the number of possibilities will continue to expand.
Hal Finney, a prominent cypherpunk – and the first person to receive a transaction from Bitcoin creator Satoshi Nakamoto – wrote in a 1993 article on Compuserve: “Thinking a little more about the idea of buying and selling digital money, I thought of a way to present it. We buy and sell crypto trading cards.
Finney knew it, and now you know it too.
Lugui Tillier is the commercial director of Lumx Studios, a Web3 studio that counts among its investors BTG Pacual Bank, the largest investment bank in Latin America. Lumx Studios has already had Web3 files with Coca-Cola, AB InBev, Nestlé and Meta. The author holds investments related to Ordinals Protocol, although none are named in this article.
This article is intended for general information purposes and is not intended to be and should not be considered legal or investment advice. The views, thoughts and opinions expressed herein are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.