For much of their existence, non-fungible tokens have been associated with Ethereum (or, to a lesser extent, protocols like Solana). But Bitcoin NFTs aren’t actually a new phenomenon. The first such collection, Rare Pepes, debuted all the way back in 2016. So why has it taken so long for the platform behind the world’s largest cryptocurrency to grab its share of the NFT action?
The answer has to do with the structure of Bitcoin. Historically, the protocol did not allow for straightforward ways to mint an NFT. That all changed with the introduction of Ordinals in early 2023.
Casey Rodarmor’s innovation opened the door to the creation of recursive inscriptions and what have become known colloquially as Bitcoin NFTs. In this piece, we’ll discuss how the return of OP_CAT (and the expanded digital art market) is changing the way we look at art.
What Do Ordinals Have To Do With Art?
Ordinal Theory is a numbering system for satoshis, the smallest unit of Bitcoin. These numbers are unique, trackable, and vary in rarity, demand and value.
But Ordinals really took off because of inscriptions. The ability to inscribe information to files – whether they be an image, an audio file, video or otherwise – directly onto the Bitcoin blockchain generated significant excitement from the community. These inscriptions, known as digital artifacts, have generated a huge market of interest in a relatively short amount of time.
Digital Artifacts or NFTs?
Technically speaking, digital artifacts and non-fungible tokens aren’t the same thing. Although the two concepts are similar and many have been using them interchangeably, there are key differences to consider.
Ordinal inscriptions, for example, occur directly on the blockchain. Many NFTs are stored off-chain or as part of a more centralized chain, such as Ethereum or Solana. Inscriptions don’t use smart contracts and therefore do not have separate metadata. NFTs are typically activated by on-chain smart contracts. These seemingly small differences provide extra security to those who hold digital artifacts, as they are settled directly on Bitcoin.
Much of the early excitement surrounding the ability to create these digital artifacts had to do with increased use cases for Bitcoin. People saw the potential for Ordinals to expand the scope of how others viewed the protocol and move it toward a future where it is seen as more than just a digital asset.
How Does OP_CAT Come Into Play?
OP_CAT, a long-dead opcode from the earliest days of Bitcoin, has been back in the conversation in recent months. This is mainly due to Taproot Wizards, the company behind the Quantum Cats collection. This series of Bitcoin inscriptions has generated an enormous amount of attention, selling out its first collection of more than 3,000 images and netting $13M. The demand has been significant, with some dubbing it a frenzy.
Taproot Wizards’ success in the digital art market has put OP_CAT and recursive inscriptions back in the spotlight. Supporters of resuscitating OP_CAT believe it could allow for smart contract-like features and bridges to L2, expanding the opportunities to create, store and trade Bitcoin-native digital artifacts. While OP_CAT has its supporters and its detractors, its potential for changing the way digital artifacts are made has been a recurring topic of conversation.
What Does It Mean to Make Art on the Blockchain?
The question of what constitutes art isn’t a new one. A simple search will turn up endless think-pieces on art’s definition, its categories and the question of who determines what qualifies. The popularization of NFTs over the past few years has served to expand that conversation into the blockchain space.
While detractors have criticized NFT art as unserious, overhyped or too easy to make a copy of, there’s no denying that it has demonstrated commercial appeal to collectors. A 2021 auction through art house Christie’s netted $69 million for a Beeple NFT – by contrast, an original Monet painting titled Nymphéas went for $15 million less in 2014.
The Beeple sale came during a high point for consumer interest in NFTs, and there’s no denying that there have been changes in market value for many collections since then. But it’s equally fair to note that there is still significant demand for digital artifacts.
The success of Quantum Cats alone demonstrates the potential for inscription art to become an even bigger player in the digital art space. But they’re not the only ones. There have been Ordinal inscription shows at Miami Art Week and art house Sotheby’s has entered the market. Late last year, they sold BitcoinShrooms NFTs for a whopping $450,000, and the Genesis Cat inscription alone brought in over $250,000.
It’s worth acknowledging how we got here. While Ordinals have simplified the creation of digital artifacts, Bitcoin NFTs were around long before it. Builders have been working to bring NFTs to Bitcoin for a decade, starting with Counterparty and more recently through Bitcoin layers like Stacks. Because Bitcoin NFTs required a layered solution to build, those looking to mint NFTs through Bitcoin had to contend with less native infrastructure than that of other chains. The growing ecosystem of art we’re seeing on Bitcoin’s base layer today is a direct result of the longtime efforts of a determined builder culture.
Conclusion
Ultimately, the question of what it means to make digital art can be broken into two subsections: what is art, and how is it made? While people can hold different views on the role inscriptions should play in the digital art sphere, there is no denying that the introduction of so-called Bitcoin NFTs has shaken up the marketplace for creators and collectors alike.
