ORDI has no technology and is useless. It is just a speculative tool. I wanted to criticize ORDI for its speculation, but I found that ORDI is the first-class meme benchmarked against Doge.
Inscriptions have opened up the rise of the Bitcoin ecosystem and paved the way for solving Bitcoin's security budget problem. The main criticism: the view that inscriptions cause the size of Bitcoin nodes to expand and thus affect decentralization is untenable.
ORDI is a useless token, with no technology and no functions. If serious project tokens need to capture value and attract investors through value, then meme tokens need to capture attention.
"Meaning" is given by humans. Compared with many memes such as PEPE, Harry Potter, Obama, Sonic, etc., ORDI can be given more and higher quality "meaning".
ORDI is a first-rate meme, but it faces the challenge of continuing to capture attention.
What is Bitcoin Inscription and BRC-20?
In December 2022, Bitcoin developer Casey Rodarmor released an open source software called ORD, which runs on the Bitcoin Core software. ORD allows users to mint Bitcoin inscriptions in two steps: 1) enter arbitrary information, such as a string of text or an image ("inscription", some translations call it inscription) on the Bitcoin blockchain, and 2) connect the uploaded inscription to a specific satoshi. Satoshi is the smallest unit of Bitcoin. 1 BTC = 100,000,000 satoshi. The final product is a satoshi with an inscription, which is the so-called Bitcoin inscription.
Bitcoin inscriptions can be divided into two categories, depending on whether the input information is text or image. Text-based inscriptions are mainly used to create tokens, such as the BRC-20 token standard. Image-based inscriptions are mainly used to create NFTs, such as various cartoon characters.
It is important to note that although inscription-based NFTs and BRC-20 tokens are stored entirely on the Bitcoin blockchain, the connection between inscriptions and individual Satoshis is established by the Ordinals theory. Each Bitcoin is composed of 100 million Satoshis, but these Satoshis are indistinguishable. Ordinals, as an off-chain numbering scheme, distinguish individual Satoshis. In other words, the existence of Ordinal requires the community to reach a consensus on the Ordinal theory and generally accept it. Without the Ordinal theory, inscriptions cannot be tracked or traded because inscriptions do not automatically point to a single satoshi. From the perspective of the blockchain, every satoshi is the same.
So what is ORDI?
ORDI is the first BRC-20 token issued on the Bitcoin blockchain, with a total supply of 21,000,000. ORDI was created as an experiment to test whether Ordinals theory could be used to deploy a homogeneous token similar to ERC20 issued on Ethereum.
Unlike Ethereum's ERC-20 token standard, Bitcoin does not support smart contracts. BRC-20 is not a smart contract token. There is no technology behind the token, no project party, no actual project support, and no application scenarios. The rise and fall of the coin price depends entirely on community consensus and market enthusiasm. BRC-20 tokens use the Ordinals theory to implement simple functions such as token issuance, setting issuance volume, and transfer on the Bitcoin network.
ORDI is a pure meme, so the evaluation of its value should be transformed from whether it is a good project to whether it is a good meme. ORDI's existence is based on the Ordinals theory. Before we discuss ORDI, let's take a look at what the Ordinals protocol means to Bitcoin.
Ordinals Protocol: Paving the way to solve Bitcoin’s security budget problem
Some people are critical of the Ordinals protocol, believing that a large amount of inscription information is written into the blockchain, which leads to an increase in network transaction fees and affects ordinary users. The rapid growth of transaction information will also increase the hard disk size of the blockchain node and increase the hardware requirements for running Bitcoin nodes. This will in turn affect the number of running full nodes and damage decentralization.
However, many organizations, including Grayscale, have suggested that the Ordinals protocol will have a positive impact on Bitcoin network security and miners’ income.
First, the emergence of the Ordinals protocol has increased the transaction fees received by Bitcoin miners. The transaction fees of the Bitcoin network have soared three times in March, May and November this year, corresponding to the three waves of Ordinals this year. According to estimates by research firm K33, miners' daily income in 2023 will be 973 BTC, higher than the originally expected 900 BTC per day. The additional transaction fees brought by Ordinals have increased miners' income by about 8%.
Transaction fee income is crucial, as it will fill the security budget of the Bitcoin network as BTC block rewards continue to decrease in the future. Miners are an important part of maintaining the security of the Bitcoin network. Currently, miners mainly rely on BTC block rewards after mining each block as income, but Bitcoin block rewards are halved approximately every four years. Fewer block rewards will lead to a decrease in miner income, which will lead to miner loss and reduce the computing power to protect the network. This is not an imminent problem, but a serious problem for the long-term development of Bitcoin.
Secondly, the increase in miners' income will attract more miners to join, expanding the overall computing power and security of Bitcoin. Higher computing power means that attackers need to invest more resources to obtain 51% computing power to launch an attack.
As for the main criticism of Ordinals, is the increased hard drive space required to run a node really a problem?
In the Bitcoin world, miners mine new blocks through computing power, nodes running Bitcoin clients (such as Bitcoin Core) are responsible for verifying the validity of blocks, and developers maintain clients. Miners, node operators, and developers form a complex game relationship, and no one party can control the Bitcoin network. If you want to have a deeper understanding of the game relationship between the various parties in the Bitcoin network, I recommend this book. The Blocksize War: The battle over who controls Bitcoin’s protocol rules
Therefore, some people worry that the rapid growth of ordinals will lead to an increase in the size of the Bitcoin blockchain, an increase in the hardware requirements for running Bitcoin clients, a decrease in the number of nodes and a decrease in decentralization, affecting the delicate balance between miners, nodes, and developers.
Although this is a very reasonable concern, the current size of Bitcoin clients, such as Bitcoin Core, is only 500GB. Assuming that every block after Ordinals is filled, the size of the Bitcoin blockchain will increase by 1TB approximately every four years (source). With hard disk space exceeding 1TB and even 2TB being quite common today, it seems premature to worry about the Bitcoin blockchain being too large. Moreover, with technological advances, the hard disk space that ordinary users can afford is also increasing rapidly.
ORDI – A powerful meme
The word meme was first coined by British evolutionary biologist Richard Dawkins in his 1976 book The Selfish Gene. Meme is similar to gene in that it is the smallest unit of culture and information that can spread and evolve between people. The value and popularity of meme tokens depend on their spreadability and the participation of community users.
Meme tokens seem to have no practical use, but they actually meet a real and huge demand of users in the cryptocurrency market: a speculative target that is full of imagination and fair.
Not every meme token is full of infinite imagination, and not every meme gives speculators a fair chance to gamble.
Many people compare BRC-20's Fair Launch with VC projects. I think this comparison is unreasonable. VCs invest in the early stages of a project and provide funding to the team. They bear huge uncertainties when it is unknown whether the product can be successfully launched and recognized by the market in the future. VCs bear huge risks and should get the cheapest chips and the biggest benefits after the project succeeds.
However, memes have no products, no technical development, and no initial investment, so a good meme should not have investors, nor should the team hold a large number of tokens. This seems to be a self-evident requirement, but the reality is not the case. The meme token pepe, which was once popular at the beginning of the year, was exposed in August this year that team members stole a large number of tokens and sold them.
The Fair Launch mechanism of BRC-20 tokens ensures that participants can only obtain tokens in the form of minting, and there is no early investment, nor does the project party hold a large number of tokens. At the same time, since BRC-20 is not a smart contract token, the functions that can be realized are limited, so there is no smart contract risk, such as theft by the project party or the contract being blacklisted. These characteristics make BRC-20 tokens a natural speculative target.
The meaning and imagination of Meme
The value and popularity of meme coins depend on their spread and community participation. Spread means capturing enough people’s attention. If serious project tokens need to capture value and attract investors with value, then meme tokens need to capture attention.
For example, after Terra collapsed, a number of Memecoins about its CEO emerged one after another. Among them, JAIL KWON once soared due to the arrest of Do Kwon. This year, a South Korean laboratory claimed to have developed the room-temperature superconductor LK-99, and the price of the related meme coin LK99 in the crypto market has experienced multiple ups and downs.
There is no cost to create a new meme coin, and each meme coin faces endless competition from other meme coins. Some competitors use simple and crude means to capture attention, such as naming it Harry Potter Obama Sonic and naming the token code BITCOIN.
So what is the narrative of ORDI, and what kind of attention can it capture? ORDI is the first BRC-20 token deployed using the Ordinals protocol, and ORDI is the first BRC-20 token with a market value of more than $1 billion. ORDI represents the Ordinals protocol, which represents the evolution of Bitcoin, solves Bitcoin's security budget problem, opens up the development of the Bitcoin ecosystem, makes Bitcoin interesting, and allows more people to enter the Bitcoin ecosystem.
"Meaning" is given by humans. Compared with Pepe, Harry Potter, Obama, and Sonic, ORDI can be given more and higher-quality "meaning". Therefore, ORDI is a first-class meme. It can be compared with other first-class memes: DogeCoin, with a market value of 13 billion US dollars. SHIBA Inu, with a market value of 5.7 billion US dollars.
ORDI’s biggest challenge: sustaining attention
Of course, this is a meme, and creating a meme is free. ORDI faces the challenge of memes that have greater cultural influence and can be given more "meaning". Here we have to mention another BRC-20 token SATS.
Each bitcoin can be divided into 100 million sats. The BRC-20 token named SATS sets the total amount to 210 trillion, corresponding to the maximum number of 210 trillion sats in the Bitcoin network. SATS was listed on Binance on December 12, bringing its market value to nearly $1 billion.
In the Bitcoin ecosystem, there will definitely be a meme coin with a market value of over 10 billion that is comparable to Doge. No one can predict whether it will be ORDI or STAS. Projects with real uses require continuous construction by the project owners to create value; a meme requires holders and the community to constantly speak out on social platforms, cheer for the meme they hold, and create attention for the meme they hold. #BRC20 #ordi、 #币圈
Well, my article is finished. I am Crypto Lao K, an old leek who sincerely wishes you can get rich in the cryptocurrency circle.
