What is the Hype Around Bitcoin Ordinals and BRC-20?

In early 2023, Bitcoin Ordinals introduced a way to inscribe unique data directly. Images, text, and videos, for example. This allowed for NFT-like assets on Bitcoin without needing smart contracts or sidechains.

Unlike most NFTs, Ordinals store data fully on-chain, making them permanent and censorship-resistant. 

This has fueled their popularity, with collectors, whales, and developers experimenting with digital artifacts on Bitcoin.

About Bitcoin Ordinals

Bitcoin Ordinals are a method of inscribing data onto individual satoshis (sats), the smallest unit of Bitcoin. 

Each satoshi (0.00000001 BTC, referred to as sat) is assigned a unique serial number based on the order in which it was mined. This numbering system, known as ordinal theory, allows each satoshi to be tracked, making it possible to attach permanent, on-chain data to Bitcoin.

Casey Rodarmor launched the Ordinals protocol in January 2023. Ordinals store all data directly on the Bitcoin blockchain, making them immutable, censorship-resistant, and fully decentralized. 

Users can inscribe tokens, text, images, videos, and even code onto individual sats, creating a form of digital collectibles that exist natively on Bitcoin.

BRC-20 tokens

BRC-20 uses the Bitcoin Taproot upgrade (soft fork) and the Ordinals protocol. There are no smart contracts involved. The tokens are generated by JSON script files that are minted on satoshis via the Ordinals protocol.

Many BRC-20 tokens were and are minted. Binance was among the first exchanges to list BRC-20 tokens, contributing to their popularity.

BRC-20 tokens also have rarity attributions based on the satoshis. Any sat that is not the first sat of its block (a block is mined every 10 minutes) is common. The first sat after the Bitcoin halving is rarer. Below is a table explaining the rarity of BRC-20 tokens.

BRC-20 rarity explained and worth

Rarity	Description	Price	Approximate Frequency
Common	Any sat that is not the first sat of its block	N/A	Most BTC are
Uncommon	The first sat of each block	$45.46 per sat	Every 10 minutes
Rare	The first sat of each difficulty adjustment period	$41,760 per sat	Every 14 days
Epic	The first sat of each halving epoch	$2,958,771 per sat	Every 4 years
Legendary	the first sat in a cycle (once every six halvings)	N/A	Every 24 years
Mythic	The first sat of the Genesis block	N/A	None, only created once

Since their launch, Ordinals have gained traction, with over 88 million inscriptions recorded as of this publication. They have expanded Bitcoin’s use cases beyond a store of value, enabling art, gaming, identity verification, and record-keeping on the network. 

The Ordinal Theory and Inscriptions

The Ordinal theory is the framework that assigns unique numbers to satoshis. Bitcoin has just under 20 million coins in circulation, each containing 100 million satoshis, meaning trillions of satoshis exist.

Integer notation: The order in which a satoshi was mined.

Decimal notation: A combination of block height and sat position.

Degree notation: A rarity grading system based on key events like halvings.

Percentile notation: A satoshi’s position in Bitcoin’s supply.

Name notation: Encoded alphanumeric identifiers.

Ord Software

Advanced users can run a Bitcoin full node to inscribe data, download Bitcoin Core, and install Ord software. This tool assigns satoshis non-fungible properties, turning them into digital artifacts. 

Some platforms may allow you to inscribe without the need to run a node.

Ordinal Inscriptions

Ordinal inscriptions store data directly in Bitcoin’s blockchain using Taproot transactions. Unlike most NFTs, which rely on external storage, Ordinals keep metadata and media on-chain. 

Initially, inscriptions were limited to 4MB, but recursive inscriptions now allow references to existing data, significantly increasing storage capacity. This has enabled innovations like fully on-chain games and applications.

If you are new to cryptocurrencies, creating your own token may be easier in other chains than via Ordinals.

How do Ordinal Inscriptions work?

Ordinal inscriptions work by embedding data onto individual satoshis (sats), turning them into unique digital artifacts on the Bitcoin blockchain. 

Unlike traditional Bitcoin transactions, which involve sending and receiving BTC, inscriptions add permanent, on-chain data to specific sats, enabling the creation of collectibles, art, and other digital assets.

Key concepts behind Ordinal Inscriptions

Each satoshi is assigned a unique ordinal number based on when it was mined. The Ordinals protocol allows users to attach data, effectively transforming these tiny Bitcoin units into individually identifiable digital assets.

Unlike Ethereum NFTs, which often store metadata off-chain, Ordinals are fully embedded in Bitcoin transactions, ensuring they remain immutable and decentralized.

Ordinal inscriptions leverage two Bitcoin upgrades:

• SegWit (2017) Introduced the “witness” section in Bitcoin transactions, which allows for larger data storage.
• Taproot (2021) enabled more efficient and privacy-focused Bitcoin transactions, making large-scale inscriptions feasible.

• No smart contracts are needed. Ordinals operate without modifying Bitcoin’s consensus rules. They simply utilize existing Bitcoin infrastructure, making them more secure than external-layer solutions.

Ordinals expand Bitcoin’s capabilities using these mechanisms, making NFT-like assets possible on the most secure blockchain.

Bitcoin Ordinals metadata

Bitcoin Ordinals store metadata directly on-chain, making them fully self-contained digital artifacts. 

Unlike Ethereum-based NFTs, which rely on external links for metadata storage, Ordinals embed all relevant data within Bitcoin transactions.

Every inscription includes metadata such as text, images, audio, or other data types, ensuring permanence and immutability.

Unlike Ethereum’s ERC-721 standard, Ordinals have no predefined metadata structure, giving creators flexibility in how they inscribe data.

Bitcoin’s block size constraints mean inscriptions must fit within available space, often leading to compression techniques for larger files.

Since metadata is stored on Bitcoin’s ledger, every inscription is publicly verifiable and linked to a specific satoshi, ensuring authenticity.

This approach makes Ordinals censorship-resistant and uniquely suited for Bitcoin-native digital assets.

Bitcoin Ordinals popularity

Bitcoin Ordinals have experienced fluctuating adoption. 

At their peak, inscriptions dominated Bitcoin transactions, briefly surpassing Ethereum NFTs in weekly sales.

However, extreme ownership concentration raised concerns about market manipulation and accessibility, leading to a sharp decline. Since its May 2023 peak, trading volume has dropped 97–98%. 

Despite this, active wallets have doubled in the past month, indicating sustained interest even as sales decline.  

Meanwhile, the BRC-20 market, which extends Ordinals to fungible tokens, had surpassed $580 million in trading volume as of early 2025, according to CoinMarketCap. However, scalability remains challenging, with high fees and network congestion limiting growth.

Data from Ordinals Explorer, Ordiscan, shows:

The total inscriptions: 88.4 million

The total inscription fees: 4,374 BTC

The stored data: 24.3 GB

The number of holders: 22,147 (Top 10 holders own 71.07%)

How to buy and sell Ordinals NFTs

Ordinal NFTs, also known as Bitcoin NFTs, have a unique structure that requires a different buying and selling process than trading Ethereum-based NFTs on OpenSea or Blur.

Since Bitcoin lacks native smart contract functionality, transactions are typically done through specialized marketplaces and wallets that support Ordinals. 

Buying Ordinals NFTs

To buy Ordinals, a wallet with some BTC in the balance is required.

1. Set up a Bitcoin Wallet that supports Ordinals

It is important to have a wallet that supports BRC-20 tokens (MetaMask does not support BRC-20).

Xverse: A user-friendly wallet with built-in Ordinals support.

Unisat: A Bitcoin wallet that allows users to store, send, and receive Ordinals NFTs.

Hiro Wallet: Supports Bitcoin and Stacks, offering a way to interact with Ordinals.

Sparrow Wallet: A more advanced option for users who want full control over their Bitcoin transactions.

2. Fund your wallet with Bitcoin (BTC)

You can buy Bitcoin from crypto exchanges and transfer the BTC to your Ordinals-compatible wallet.

If you prefer not to use an exchange, you can purchase Bitcoin from P2P marketplaces.

3. Choose an Ordinals Marketplace

Ordinals NFTs are traded on specific marketplaces — some of which include:

Magic Eden: Originally an Ethereum and Solana marketplace, now supporting Ordinals NFTs.

Ordinals Wallet: A marketplace built specifically for buying, selling, and storing Ordinals NFTs.

Unisat Marketplace: Offers direct buying and selling of Ordinals, integrating well with Unisat Wallet.

Gamma: A Bitcoin-focused NFT platform supporting Ordinals inscriptions.

OKX marketplace: Unified marketplace for buying, selling, and minting BRC-20 and Ordinals assets.

4. Browse and Select an NFT

Once on a marketplace, you can browse available Ordinals NFTs. Since Bitcoin doesn’t have smart contracts, these marketplaces act more like escrow services, ensuring transactions are completed securely.

5. Complete the purchase

After selecting an NFT, follow these steps:

1. Connect your wallet to the marketplace.
2. Confirm the transaction – You’ll need to send Bitcoin to the seller’s address.
3. Wait for confirmation – Bitcoin transactions require multiple confirmations on the blockchain, which can take a few minutes to an hour.
4. Receive your asset – Once the transaction is confirmed, the Ordinals NFT will appear in your wallet.

Selling Ordinals NFTs

1. Ensure your NFT is stored in an Ordinals-Compatible wallet

Before selling, confirm that your NFT is in a Taproot-compatible wallet such as Unisat, Xverse, or Ordinals Wallet. Sending Ordinals to an incompatible address could result in permanent loss.

2. Choose the method of sale

There are two main ways to sell Ordinals NFTs:

1. Through a Marketplace – The easiest way to list and sell NFTs is on platforms like Magic Eden or Ordinals Wallet.
2. Over-the-counter (OTC) trades – Some collectors prefer direct sales through trusted Telegram or Discord communities. This method can be riskier without escrow protection.

3. List your NFT on a Marketplace

To sell on a marketplace:

1. Connect your wallet to the chosen platform.
2. Select the NFT you want to sell.
3. Set a price in BTC. You can either list at a fixed price or use an auction format.
4. Confirm the listing – The marketplace will generate a Bitcoin transaction for your NFT sale.
5. Wait for a buyer – Once a buyer purchases your NFT, the marketplace will handle the transfer securely.

4. Manage Bitcoin transaction fees

Selling Ordinals involves Bitcoin network fees, which vary depending on network congestion. 

For instance, while they vary, sales can incur network fees (5-20 sat/vByte in low congestion, 50+ sat/vByte in high congestion), plus marketplace fees(1%- 2%) and royalties (2%- 10% if applicable).

5. Receive Bitcoin Payment

Once the sale is complete:

• The marketplace releases the BTC to your wallet.
• If selling OTC, ensure you receive payment before transferring the NFT.
• Withdraw BTC to an exchange if you plan to convert it into fiat currency.

Writer’s note: While marketplaces are improving, the process is still less streamlined than on Ethereum, making it crucial to double-check transactions before executing them.

Ordinals alternatives: Bitcoin Runes

Bitcoin Runes is a new token standard designed to improve upon the limitations of Bitcoin Ordinals. 

While Ordinals allow users to inscribe data onto individual satoshis, they face challenges such as metadata constraints, insufficient storage, and blockchain bloat issues.

Runes aims to solve these issues by integrating more efficiently with Bitcoin’s native transaction model.

Key differences between Ordinals and Runes:

Ordinals function as NFTs, while Runes support fungible tokens, making them more similar to Ethereum’s ERC-20 standard.

Runes encode metadata directly within UTXO outputs, bypassing Bitcoin’s 80-byte OP_RETURN limit, which is a rule that allows users to store up to 80 bytes of extra data in a transaction

Unlike Ordinals, which create additional unspent transaction outputs (UTXOs), Runes optimize token transfers to prevent unnecessary data accumulation.

Runes operate entirely on-chain without relying on off-chain indexers, making them more decentralized and secure.

By addressing the Ordinals’ limitations, Bitcoin Runes offers a more scalable and flexible way to issue and transfer tokens on Bitcoin. 

Its improved efficiency and reduced reliance on external systems make it a strong alternative to tokenization within the Bitcoin ecosystem.

Conclusion

Bitcoin Ordinals have revolutionized Bitcoin’s blockchain by enabling NFTs and digital artifacts. 

While they have sparked controversy over network congestion and fees, they have also significantly impacted how the crypto and broader community perceive Bitcoin. 

Despite fluctuating popularity, Ordinals continue to evolve, and alternatives like Bitcoin Runes aim to refine Bitcoin’s tokenization capabilities. 

Whether as collectibles, record-keeping tools, or new financial instruments, Bitcoin Ordinals have expanded Bitcoin’s possibilities.

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