During a Twitter Space conversation on July 7, Vitalik Buterin, along with Bitcoin proponents Eric Wall and Udi Wertheimer, discussed the recent developments in the Bitcoin ecosystem. Buterin praised the implementation of Bitcoin Ordinals and the BRC-20 token standard, suggesting these advancements are stirring up a revival of the “builder culture” within the Bitcoin community. He believes these innovations are a positive response to the stagnation in the ecosystem and a tangible resistance to the “laser-eye” movement.
What is the Ordinals
The Ordinals project appeared in January 2023. It introduced the ability to embed images and other types of data on the Bitcoin blockchain. These "inscriptions", referred to as "digital artifacts", store raw data written directly to the blockchain. The popularity of Ordinals is evidenced from the numbers, with over 15 million "inscriptions" created since the project’s launch.
BRC-20, an experimental standard of interchangeable tokens for the Bitcoin blockchain, was created in early March of this year. The name is consonant with the ERC-20 of the Ethereum ecosystem. However, BRC-20 does not rely on smart contracts; instead, tokens are based on the Ordinals projec’s mechanism. They are deployed by adding JSON text files to the blockchain, containing essential coin features such as offer, issue limit, etc.
The first token compliant with the standard is ORDI, currently priced at around $6.8. The asset is available on well-known CEXs like OKX, Kucoin, and Huobi.
The conversation also delved into the issue of scalability within the Bitcoin network. Eric Wall opined that Bitcoin's Lightning Network is ill-equipped to handle the future users' demands, highlighting its occasional failures even with medium-sized payments. Buterin suggested that the Bitcoin community should focus on different types of layer-2 solutions and work towards enhancing the Bitcoin base layer's efficiency.
Udi Wertheime echoed this sentiment, emphasizing that the adoption of rollups could yield an intriguing side effect: the creation of an execution environment conducive to smart contracts. He said, "If we adopted rollups for Bitcoin, we actually get an execution environment too [...] We can do smart contracts."
However, these stances have faced criticism from Bitcoin fundamentalists who argue that the incorporation of NFTs and smart contracts dilutes Bitcoin's primary purpose as a peer-to-peer cash network. Udi Wertheimer posted a scathing tweet about Jan3 CEO Samson Mow and Blockstream CEO Adam Beck, who dismissed the dialogue with Buterin.
Also read: What is Bitcoin