Introduction to Bitcoin Ordinals

UTC by Ibukun Ogundare · 7 min read
Introduction to Bitcoin Ordinals
Photo: Shutterstock

The creation of Bitcoin ordinals is a thoughtful and innovative development for the world’s first cryptocurrency. It has gained massive adoption from several blockchain enthusiasts and onlookers within a short time. The following guide describes Bitcoin ordinals and how they function.

Since the inception of non-fungible tokens (NFTs), many have begun to wonder about the correlation between a random digital item and the blockchain. In 2021, NFTs gained massive popularity generating over two billion dollars in revenue and finding numerous use cases. However, the Bitcoin (BTC) network could not cause any due to the rigidity of its build. Other blockchain networks like Ethereum (ETH), Polygon (MATIC), and Cardano (ADA), among others, accommodated the minting and trading of NFTs. Satoshi Nakamoto’s cryptocurrency initially focused on improving the speed, anonymity, and flexibility of financial transactions. However, many users opposed Bitcoin’s concentration on transactional activities against the multi-functionality of Ethereum, a decentralized, open-source blockchain with smart contracts.

After several agitations, Bitcoin received several tweaking forks, thereby increasing the diversity of the blockchain. These forks include SegWit, Bitcoin Gold, Bitcoin Diamond (BTCD), Classic, Bitcoin Cash ABC, Bitcoin Cash SV, Taproot, and many others. Bitcoin ordinals, a recent upgrade developed by Casey Rodarmor, will allow users to inscribe metadata in images, JSON, and texts into satoshis. Satoshi is a fraction of a whole Bitcoin; there are 100 million satoshis in 1 BTC. This significant fork could be the birth of NFTs minting on the world’s first cryptocurrency. Interestingly, Bitcoin ordinals function on a different mechanism from the conventional NFT. Below we will discuss how.

Bitcoin Ordinals Defined

Bitcoin ordinals, alternatively called Bitcoin NFTs, are digital assets inscribed on the satoshi. As earlier stated, a satoshi is the lowest denomination of Bitcoin. Basically, these digital artifacts are “sats” that have been ordered and inscribed with a piece of information. These pieces of information transformed an ordinary satoshi into a de-facto NFT. Before the emergence of Bitcoin ordinals, other NFT attempts on the Bitcoin blockchain include Counterparty (2014) and Stacks (2017). Bitcoin NFTs were introduced in January 2023.

How Do Bitcoin Ordinals Work?

Bitcoin ordinals arose from contention among the Bitcoin community over the monotonous function of the blockchain. The lack of diversity in the Bitcoin blockchain was caused by its meager transaction size of 80 bytes which could barely contain text messages. The upgrade implemented through SegWit and Taproot turned things around by increasing Bitcoin transaction size to almost 4MB. These upgrades allow for a refined arrangement of transactional data.

Users can identify the position of sitting according to four parameters:

  • The index of sat in the block.
  • The index of the block in the difficulty adjustment period x/2016.
  • The index of the block in halving epoch x/210,000.
  • The cycle number.

This arrangement implies that a preceding sat is rarer than the immediate successive sat. In technical terms, ordinal uses remodeled codes as an envelope for data inscribed onto sats.

Ordinal Inscriptions

Ordinal inscriptions are metadata of digital artifacts written on sats; they do not require a sidechain or a separate token. The direct presence on the blockchain is one of the contrasts between Bitcoin NFTs and Ethereum-based NFTs. These data are stored in taproot script-path spend scripts under the storage of 4MB.

Through a two-step process, anyone can generate an ordinal inscription. To begin with, users should create a taproot output with inscription content. After that, they can spend the output to reveal the inscription content on the blockchain. The inscription content is enveloped in a type of no-op that does not change the script. Considering the ordinal theory, inscriptions can be transferred, traded, and recovered. The ordinal theory defines satoshis (sats) as the atomic unit that can be identified and traded individually on the Bitcoin network.

Inscriptions can be traded on the Ordinal Punks website. Users can explore the ordinals’ Discord channel., the leading marketplace on Stacks, plans to unveil a paid marketplace where users can generate and trade inscriptions (text or images). Oridalsbot, a product designed by the creators of the Satoshibles NFT collection, also performs similar services. Some wallets like Xverse, Hiro wallet, and Sparrow wallet are currently rolling out support for Bitcoin NFT. A specialized wallet like Ordwallet can receive ordinals, create inscriptions and prevent accidental spending by freezing individual sats. To run an Ordwallet, users require a full Bitcoin node and 500 GB of disk space.

Bitcoin Ordinals vs Traditional NFTs

Bitcoin ordinals look relatively similar to traditional NFTs, intersecting in the ability to incorporate digital items. From a more technical standpoint, there are several differences between the two digital assets. Bitcoin ordinals can be found on-chain as all raw data are directly written on the blockchain. On the other hand, NFTs are minted separately as a new token that could have references to files on other blockchains.

Bitcoin currently has a hard cap of 21M total supply and a 4MB limit. These stats could hinder the amount of Bitcoin NFT mint if all space was used as ordinals. NFTs on other blockchains have a more flexible and expansive minting space. The Bitcoin space uniquely differs from Ethereum and has no smart contracts, decentralized exchange, or easily accessible wallets. It has a poor UI restricting trading of ordinal to over-the-counter. Regardless, ordinal trading has gathered attention from many users.

The rarity of a traditional NFT is solely determined by the attributes of the artwork, which invariably affects the asset’s price. For Bitcoin ordinals, rarity might depend on the order of minting. Collectors can decide to have a flare for the first 1000 sats mint. It is possible for Casey Rodarmor’s inscription of “tiny pixel art” of a skull, popularly known as Genesis Block, could be worth millions of dollars in the next few years.

Finally, traditional NFT can regulate the kind of content generated, unlike Bitcoin, a permissionless sphere where the inscription on sats cannot be censored. This means users can freely generate permanent illicit and copyrighted content.

Bitcoin Ordinals’ Use Cases

The use cases of Bitcoin ordinals are very scanty at the moment. Their limited block size will significantly restrict their functionality against NFT-diversified use cases. For example, inscribing a game into a Bitcoin Ordinal is quite unfeasible due to the 4MB transaction size. Future exploration of Bitcoin Ordinals could revolve around the following: music, fashion, metaverse, supply chain, luxury products, and artworks.

Most Popular Bitcoin NFT Collections

Within a short period, several Bitcoin NFT collections have surfaced. Amidst the numerous, here are a few popular Bitcoin NFT collections:

  • Ordinal Punks – a collection of 100 NFTs minted within the first 650 inscriptions on the Bitcoin blockchain. It has a minimum bid price of 3.7 BTC and a maximum bid price of 50 BTC.
  • Taproot Wizard – a creation by Udi Wertheimer consisting of an ordinal collection of hand-drawn NFT wizards.
  • Bitcoin Rock – a collection of 100 supply-capped NFTs featuring the aesthetic and spirits of Ether Rock, one of the first NFT collections on the Ethereum blockchain.
  • Timechain Collection – a limited set of 21 ordinals depicting various forms of timepieces. These timepieces vary in rarity as Pocket Watches, Ancient Sundials, Wristwatches, Wall Clocks, Cyberpunk Alarm Clocks, Clock Towers, Monolith, and Grandfather Clocks.
  • Ordinal Loops – this NFT is popularly known as Object 0; it is a rotating mathematical torus and is one of just seven similar animations in the first collection from Ordinal Loops. It was auctioned for 7.156 BTC ($156,500).

Benefits and Challenges

Here are some important benefits that accompany the introduction of Bitcoin ordinals. These digital artifacts will increase Bitcoin use cases, the number of users, and the adoption rate. Ordinals creator campaign is saying: “Come for fun, rich art, stay for the decentralized digital money.” Unlike Ethereum NFT, ordinal transactions are more decentralized, immutable, well-secured, and transparent. Assets are directly pegged to the blockchain with relatively cheaper transactional fees costing $50 to 1M bytes.

The violation of copyright and privacy might pose a serious threat to Bitcoin ordinals, thereby enabling the growth of malware. At the moment, there is no regulatory mechanism on the open network. For many Bitcoin core developers, the introduction of Bitcoin ordinals has deviated from its initial financial mission.


The creation of Bitcoin ordinals is a thoughtful and innovative development for the world’s first cryptocurrency. It has gained massive adoption from several blockchain enthusiasts and onlookers within a short time. Nevertheless, it must be treated cautiously, as exploitation is bound to occur. Hopefully, it will expand and maximize the utility of the Bitcoin network shortly.



What are Bitcoin ordinals?

Bitcoin ordinals (or Bitcoin NFTs) are metadata of digital items inscribed on tiny fragments of a Bitcoin called satoshi (1 BTC = 100,000,000 satoshis). Digital items include images, JSON, texts, etc.

How do Bitcoin ordinals work?

The functionality of Bitcoin ordinals is based on the increased transactional size of Bitcoin’s block. SegWit and Taproot upgrade to the Bitcoin network increase this size from 80 bytes to approximately 4MB. This increased space allowed for the accommodation and arrangement of more data into the chain to be accommodated or arranged.

What is an ordinal inscription?

An ordinal inscription is a piece of metadata enveloping digital artifacts written on a satoshi. They do not require a sidechain or a separate token.

How are ordinal inscriptions generated?

Ordinal inscriptions are generated by creating a taproot with inscription content and then spending the output to reveal the content on the blockchain. Alternatively, Ordwallet can be used to generate ordinal inscription.

How are Bitcoin ordinals different from traditional NFTs?

Unlike traditional NFTs, Bitcoin ordinals are directly attached to the blockchain. Traditional NFTs require a wholesome process of tokenizing the digital collectibles to the desired blockchain. 

What are the top Bitcoin NFT collections?

The top Bitcoin NFT collections are Ordinal Punks, Taproot Wizards, Ordinal Loops, Bitcoin Rock, and Timechain Collections.

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