Miner fees have tanked from $170K to $11K in less than two weeks—but a new Yuga Labs project may rekindle things.
Ordinals took the Bitcoin network by storm in January, the hot new thing that dominated the conversation around the oldest and largest blockchain. On Monday, the number of Bitcoin Inscriptions crossed 200,000, according to data from Dune Analytics.
Ordinal Inscriptions, similar to NFTs, are digital assets inscribed on a satoshi, the lowest denomination of a Bitcoin (BTC). Inscribing on satoshis, named after the pseudonymous creator of Bitcoin, Satoshi Nakamoto, is possible thanks to the Taproot upgrade launched on the Bitcoin network on November 14, 2021.
Since February 15, however, the amount of fees paid to Bitcoin miners each day has steadily decreased to $54,000 on Feb. 20 to currently just over $11,000 at the time of publication.
“Clearly we have not been shipping features fast enough to keep the mempool full,” Ordinals creator Casey Rodarmor, a former Bitcoin Core contributor, told Decrypt. “We regret our sloth and will rectify the matter in due time.”
Yuga Labs may also help revive the frenzy. The Bored Ape Yacht Club creators announced today its own series of 300 Ordinals, the highest profile adoption of the technology to date.
Bitcoin transaction fees are determined by the volume of data in the transaction and the speed at which the user wants their transaction completed. Users who want their transactions to go through during periods of high traffic can decide to pay more fees to push their transactions through.
Fees rise when the demand for processing transactions outstrips the supply of miners. On the Bitcoin network, an individual block is 1MB, meaning miners can only confirm 1MB of transactions per block.
At the height of the initial craze, users inscribed whatever they could that would fit within that 1MB block size, including a copy of the original Doom.
On February 7, 2023, over 21,824 Bitcoin NFTs were minted on the network; these inscriptions included text, images, video, and audio files. Currently, just over 5400 text and image inscriptions have taken place.
Meanwhile, the enthusiasm around Ordinals has led developers on other proof-of-work blockchains like Litecoin and Dogecoin to attempt to copy the project, launched on January 21.
On February 19, software engineer Anthony Guerrera launched the Litecoin Ordinals project on GitHub after forking the GitHub repository for Bitcoin Ordinals.
Guerrera told Decrypt at the time that Litecoin was chosen due to being the only other blockchain with similar functionality and the same SegWit and Taproot upgrades as Bitcoin.
While Ordinal Inscriptions do not require third parties to create, developers on Bitcoin sidechain projects like Stacks have taken this new interest in Bitcoin NFTs to push Ordinal compatible wallets and marketplaces, of course, powered by their token.