The cryptocurrency community is currently split on the question of whether the recent implementation of a nonfungible token (NFT) protocol on the Bitcoin mainnet would be beneficial to the Bitcoin ecosystem.
The software programmer Casey Rodarmor is responsible for the creation of the protocol, which is known as “Ordinals.” He is also the one who formally debuted the programme on the Bitcoin mainnet after writing a blog post on January 21.
On the Bitcoin network, NFTs are referred to as “digital artefacts,” and the protocol effectively enables the creation of Bitcoin’s own version of them.
These “digital artefacts” might be in the shape of JPEG photographs, PDF documents, or even audio or video formats.
The introduction of the protocol, on the other hand, has caused discord within the Bitcoin community. While some claim that it expands the financial applications of Bitcoin, others argue that it moves Bitcoin further from Satoshi Nakamoto’s original vision of the cryptocurrency as a decentralised peer-to-peer cash system.
Dan Held, a Bitcoin bull, was one among many who supported the idea. He pointed out that it would boost demand for block space — and hence costs — while also adding additional use cases to Bitcoin.
Some people have pointed out that the block space on the Bitcoin network has been taken up by structures that are similar to NFTs, which might cause transaction costs to increase.
A person on Twitter with the handle “Bitcoin is Saving” is one of such individuals. On January 29, they claimed to their 237,600 followers that “privileged affluent whites” who wish to utilise JPEGs as status symbols may restrict marginalised people from participating in the Bitcoin network.
Eric Wall, a researcher in the field of cryptocurrencies, was of the other opinion and said that Bitcoin’s built-in block size restriction would prevent an increase in transaction costs.