The New Frontier in Blockchain: Inscription

In blockchain, "inscription" primarily refers to the transaction data on the Bitcoin blockchain and the information contained within Bitcoin blocks.

Each Bitcoin block contains a batch of transactions. The hash value generated by cryptographic algorithms for these transactions is included in the block. This hash value acts as the "inscription" for the block, serving as a unique identifier created by a special algorithm.

The generation of this hash value uses cryptographic algorithms like SHA-256, ensuring the uniqueness and immutability of each Bitcoin block.

Thus, once a block is formed, its "inscription" becomes the block's unique identifier, ensuring the security and immutability of the Bitcoin blockchain.

The term "inscription" first emerged in the Bitcoin ecosystem.

The NFT protocol Ordinals, based on Bitcoin, records data, images, audio, video, and even software within transaction information.

The Ordinals protocol is a system for numbering satoshis (sats), assigning sequence numbers to each satoshi, and tracking them in transactions. In essence, users can append additional data to transactions through Ordinals, a process known as "recording."

Ordinals are directly recorded on individual satoshis and then incorporated into Bitcoin blockchain blocks. Ordinals fully reside on the blockchain, without requiring sidechains or separate tokens. In this sense, Ordinals inherit Bitcoin's simplicity, immutability, security, and durability.

Ordinals allow users to create NFTs not only from JPEGs but also from PDFs, videos, and audio files, making each satoshi a unique NFT.

Given Bitcoin’s total supply is capped at 21 million, the number of inscriptions is also limited. In the NFT realm, uniqueness and scarcity can add significant value to NFTs, and early Bitcoin NFT inscriptions may become increasingly valuable.

Data shows that the total number of Bitcoin inscriptions has reached 35 million, with a total cost of 2,119.8 BTC. Furthermore, the number of inscriptions has been steadily increasing since their inception.

Predictions from March indicate that by 2025, the market value of Bitcoin inscriptions could reach $5 billion. Recently, two inscription projects, ORDI and SATS, listed on exchanges, have market values of $1.15 billion and $1.29 billion, respectively, suggesting that the market’s potential is still underestimated.

Due to the ongoing popularity of inscriptions, inscription projects have started migrating from the Bitcoin network to other blockchains, including ETH, Solana, EOS, TON, IOST, and Conflux. As more inscription projects emerge, the early scarcity and uniqueness of inscriptions are being diluted by later entrants.

With the rise of FOMO (Fear of Missing Out) around inscriptions, miners on various blockchains, including Bitcoin, have seen significant gains. Interviews with Bitcoin miners reveal that mining profits have increased by 60-100% compared to before the surge in inscriptions, effectively doubling their income.

The explosive growth in the inscription sector has sparked competition among exchanges and wallets, indicating that inscriptions are not only popular among investors but also gaining attention from platforms. These platforms and individuals are supporting the promotion of inscriptions.

Overall, inscriptions are a pioneering force in the blockchain market, driving market sentiment. However, with the increasing number of opportunistic projects, investors need to remain vigilant to avoid potential asset losses.