What Are Bitcoin Ordinals

Understanding the Basics of Ordinals: Digital Artifacts on Bitcoin

Bitcoin Ordinals are a new way to inscribe data onto the Bitcoin blockchain. By assigning numbers to Satoshis (sats), the smallest bitcoin units, Ordinals enable the creation of unique digital assets, also known as Digital Artifacts, directly on the Bitcoin blockchain.

Ordinal inscriptions are Digital Artifacts that are created by inscribing sats with content such as text, images, or videos. The content is stored in the witness portion of a Bitcoin transaction, and the 2021 Taproot upgrade enables inscriptions that are almost 4 MBs in size.

Ordinals offer a unique way to create verifiably unique digital assets on the Bitcoin blockchain.

How do Bitcoin Ordinals work?

Ordinals are numbers assigned to Satoshis (sats), the smallest units of Bitcoin. They are assigned in order of mining and transfer and allow for the tracking and transferring of individual sats. Ordinals enable the creation of unique digital assets, such as NFTs, directly on the Bitcoin blockchain.

Ordinal Theory is a proposed methodology for individually identifying and tracking sats throughout Bitcoin's outstanding supply and inscribing them with data. Satoshis are not actually serialized at the protocol level, but inscriptions can be used to provide stable identifiers for various Bitcoin applications.

Why use the term 'Digital Artifact' and not NFT?

Using the term "Digital Artifact" instead of "NFT" is a way to make the concept more approachable and less intimidating for those who may not be familiar with the blockchain technology behind NFTs.

The term "artifact" is often associated with historical or archaeological objects, which can give people a sense of the significance and value of sat inscriptions as unique digital creations. The use of the term "digital artifact" helps to make the idea of sat inscriptions as collectible, valuable digital assets more accessible to a wider audience.

What is the Bitcoin Mempool?

The Bitcoin Mempool is a critical component of the Bitcoin network that serves as a temporary storage area for all pending transactions. Whenever a Bitcoin transaction is initiated, it is broadcast to the entire network and picked up by a miner for inclusion in the next block. However, since only a limited number of transactions can be added to a block, some transactions may have to wait in the Mempool until there is space available in a block. The Mempool acts as a queue for unconfirmed transactions, and the transaction fees offered by users determine their priority for inclusion in the next block.