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2 reasons why Bitcoin Ordinals are ‘positive’ for the BTC: Grayscale

May 1, 2023No Comments

bitcoin (BTC) Ordinals, also known by some as Bitcoin NFTs, could renew developer enthusiasm for Bitcoin and increase mining fees, according to cryptocurrency investment firm Grayscale.

In an April 27 "Market Byte" blog post, the firm He suggested that ordinals provide two key benefits for the growth and development of the Bitcoin ecosystem.

The first is a substantial increase in fees paid to miners, which has been seen since the launch of the protocol in Januaryaccording to Grayscale.

“The advent of ordinals has led to an increase in the total fees paid to miners [...] which could potentially set a sustainable baseline level of transaction fees to incentivize miners.”

Grayscale argued that this would ensure "continued network security for the life of the Bitcoin network."

As reported by Cointelegraph, in less than two months after its launch, more than $600,000 Bitcoin miners were paid, solely as a result of fees generated by ordinal signups. At press time, that figure now exceeds the $6.5 million mark.

Fees spent on enrollment of ordinal NFTs on the Bitcoin blockchain. Fountain: D.an analysis

The investment firm also believes that Ordinals and the "speed of NFT adoption" could also attract new Bitcoin users and lead to further development on the Bitcoin network.

"We believe that the appearance of ordinals is likely to promote a development-oriented community and culture in support of the Bitcoin network."

On April 30, Ordinals reached a new record, with the number of daily registrations surpassing 300,000.

Around the same time, the number of Bitcoin transactions approached peaks not seen in several years. according to the blockchain data signature IntoTheBlock.

Related: Magic Eden Launches Market for Bitcoin Ordinals

The meteoric rise of ordinals has been a controversial topic in the Bitcoin community at large, as been widely criticized by Bitcoin maximalists for deviating from Bitcoin's original purpose as a peer-to-peer electronic currency and obstructing valuable block space.

One of those critics is Blockstream CEO Adam Back who has made a series of comments declaring ordinals "useless" and stating that he is "more interested in Bitcoin as a currency."