Everything Old Is New Again

This text is featured in Bitcoin Journal’s “The Inscription Problem”. Click on right here to get your Annual Bitcoin Journal Subscription.

Let me begin off by acknowledging that Ordinals are wonderful! Ordinal Concept is a really intelligent technique of tokenizing particular person satoshis and Casey Rodarmor deserves excessive reward and recognition for gamifying the blockchain and Making Bitcoin Enjoyable Once more. For the primary time within the historical past of Bitcoin, now we have NFTs on the heaviest proof-of-work chain, preserved indelibly eternally!

Okay, now that we obtained that out of the best way, let’s dive into some “inconvenient” historical past. Ordinals was not the primary — removed from it. Tokens have existed on meta layers on high of the Bitcoin blockchain for a minimum of a decade. Most have been flashes within the pan like Coloured Cash; by no means fairly launched, like RGB; or under-the-radar this complete time, like Counterparty.

You could not have heard of Counterparty — an incredibly excessive variety of Bitcoiners haven’t — which launched in 2014 with a good “proof-of-burn” that despatched 2,130 bitcoin to an irrecoverable burn deal with, however you’ll have heard of Uncommon Pepe, an early, pioneering “tokenized artwork” assortment on Bitcoin consisting of 1,774 hilarious and dank works revolving round Pepe the Frog. RAREPEPE (Sequence 1, Card 1) generally known as the “Nakamoto Card” offered for upwards of half 1,000,000 {dollars} throughout peak NFT mania. One other card, HOMERPEPE (Sequence 2, Card 32) was in all probability the primary vital NFT sale ever at $38,000 in 2018 after which once more for $320,000 in early 2021.

Oh, did I point out I’m an authentic Uncommon Pepe artist? I submitted a bit entitled CHAMPAGNETNT (Sequence 25, Card 38) that poked enjoyable on the then-current ICO increase, and eventual bust. The wonderful thing about the Uncommon Pepe assortment is that it acts as an illustrative time capsule of what was taking place in Bitcoin (and crypto) throughout the 2016-2018 period, warts and all. However this was all earlier than 2021, earlier than NFTs went bananas, so there actually wasn’t a lot hypothesis or expectation of revenue. It was only a bunch of dudes (largely dudes) hanging out on Telegram and making dank artwork to share with mates. I gave away half the provision of my card with out even stopping to think about if it might be price one thing “sometime”.

Let’s skip ahead a couple of years. It’s early 2023 and Ordinals is making waves because the shiny new factor. What makes Ordinals novel? A intelligent technique of FIFO (first in; first out) accounting, which reimagines waves of satoshis as particular person, trackable particles. It’s an abstraction, as a result of satoshis don’t actually exist as particular person, non-fungible models. But when everybody agrees on the FIFO accounting technique, we are able to all collectively consider that they exist and due to this fact they do! The wave-function collapses due to the observer impact of Ordinal Concept. And as soon as they exist, we are able to additionally fake that proudly owning a sure one corresponds with possession of a specific inscription on the blockchain, very similar to a star registry offers you a declare on some distant solar. Ordinal Concept is a lens by which to view the blockchain in fascinating new methods. It’s like magic!

So once I first came upon about Ordinal Concept I used to be fully blown away. I all the time thought, “Nicely you’ll be able to’t simply manifest one thing new into existence just by claiming it to exist utilizing an arbitrary counting technique fully extrinsic to the system itself”. However apparently you’ll be able to! The unreal partitions in my thoughts that had been constructed up round “loopy concepts that might by no means work” abruptly vanished and I might see a transparent path in entrance of me: I could make up stuff too! And that’s how Bitcoin Stamps was born. Nicely, not precisely. Concepts are a dime a dozen, however the implementation of an concept is actually what brings it to life. I’ve had the privilege of working with some nice coders and engineers which were indispensable in launching and evolving the Bitcoin Stamps protocol: Kevin, Arwyn, Regan, B0B Smith, and plenty of others. We have been additionally lucky sufficient to leverage the decade-old Counterparty protocol, maintained by many lean years by stalwarts like JDog and Joe Looney, to shortly bootstrap Bitcoin Stamps.

So what precisely is a Bitcoin Stamp? Nicely, it’s Safe Tradable Artwork Maintained Completely.

Basically, a picture file, like a JPEG or GIF, is transformed into an extended Base64 string — Base64 is a technique to encode binary knowledge as printable textual content — that’s appended to the URI (Uniform Useful resource Identifier) “stamp”: and positioned within the description area of a Counterparty transaction. Explorers and wallets convert these lengthy Base64 strings again into viewable photos.

Right here is the Base64-encoded string of the very first Bitcoin Stamp (#0):

stamp:iVBORw0KGgoAAAANSUhEUgAAAAUAAAAFCAYAAACNbyblAAAAHElEQVQI12P4//8/w38GIAXDIBKE0DHxgljNBAAO9TXL0Y4OHwAAAABJRU5ErkJggg==

A giant promoting level for Bitcoin Stamps is the preservation of knowledge as soon as minted on the blockchain. How is that this persistence of knowledge achieved? The best way Counterparty usually operates is to encode knowledge right into a transaction’s OP_RETURN. OP_RETURN’s are restricted to 80 bytes which is sort of restrictive from a “storage” perspective. Nevertheless, OP_RETURN works properly for conventional NFTs that make use of an HTTPS pointer to a useful resource on a third-party server like AWS. Generally, whenever you inform folks the artwork isn’t really “on chain” it’s like telling them Santa Claus doesn’t exist. Alas, it’s true: The overwhelming majority of NFTs all through the years are mere tips to off-chain artwork which makes them very inclined to bit-rot. When the AWS invoice stops getting paid, the artwork is gone eternally.

There’s one other approach, nevertheless, to encode bigger quantities of knowledge utilizing a regular Counterparty transaction: naked multisig encoding. Basically, when a transaction’s knowledge exceeds 80 bytes, Counterparty as a substitute chunks and encodes that knowledge right into a naked multisig’s key-strings, utilizing a 1-of-3 quorum the place two of the three keys are utilized to retailer knowledge in a sneaky trend. The one precise redemption key within the multisig that may spend the outputs is a burner: The artist doesn’t even have management of a corresponding non-public key. We name this method KeyBurn because it ensures that the info saved throughout the UTXO set can’t be eliminated by spending.

Bitcoin Stamps occur to be extraordinarily SIGOPS (Signature Operations) heavy because of how the info is saved. Typical transactions don’t include so many SIGOPS, which has led some mining swimming pools to chop corners over time, and never depend them when together with transactions in a candidate block. Everyone seems to be conscious of the block dimension restrict, however do you know there’s an 80,000-SIGOPS restrict per block as properly? I didn’t! I discovered this out when information first broke that F2Pool had created an invalid block that obtained rejected by the community for exceeding the SIGOPS restrict because of all of the Stamp transactions in it, which have been tied to very juicy mining charges. Costly mistake! Then they did it once more shortly after. That’s 6.25 BTC misplaced twice, not together with transaction charges.

How does this differ from Ordinal inscriptions? Nicely, I prefer to say that Rodarmor got here up with probably the most accountable answer for inscribing knowledge on-chain by putting it within the SegWit witness knowledge construction. It is a knowledge construction that’s been designed with optionality in thoughts: Don’t need it? That’s tremendous, as soon as your node validates the signatures, the info could be simply discarded. In actual fact, something earlier than an “Assume Legitimate”-marked block doesn’t should be downloaded in any respect! Inscriptions are designed to respect the needs of node runners, and what did Rodarmor get for being so gracious?

OUTRAGE! HOW DARE YOU STORE YOUR JPEGS ON MY NODE!

Bitcoin Stamps takes a unique, a lot much less well mannered, strategy. The information encoded within the bare-multisig isn’t solely held in blocks, but in addition within the UTXO set as unspent outputs. This knowledge is way more troublesome to “prune” as each node, by default, maintains a full copy of the UTXO set. So whereas inscriptions are saved in a blockchain-adjacent knowledge construction referred to as “the witness” which, by design, makes pruning simple, Bitcoin Stamps are saved in precise blocks within the canonical Blockchain knowledge construction in addition to the UTXO set held in reminiscence by each node.

Right here’s the way it breaks down:

Ordinal Inscriptions: saved by post-SegWit, full archival nodes solely. Pre-SegWit nodes won’t ever know that your lovely JPEGs even exist. Unhappy.

Bitcoin Stamps: saved by each node. Interval. Pre-SegWit nodes. Submit-SegWit nodes. Full Archival Nodes. Pruned SPV nodes. All of them get the Bitcoin Stamps. ALL NODES MATTER.

I prefer to make this analogy: Ordinal inscriptions are like drawing with chalk on a sidewalk on a sunny day. Bitcoin Stamps is like spraying graffiti on the sidewalk. It’s very impolite and delinquent. It’s additionally very arduous to take away.

Now you is likely to be questioning: This sounds too good to be true, Mike, what’s the catch?

Nicely, there’s a catch: Everlasting storage on the blockchain isn’t low cost. Bitcoin Stamps don’t make the most of witness knowledge so that they don’t profit from the witness low cost. As a rule of thumb, Bitcoin Stamps price a minimum of 4 instances what Ordinals price to inscribe. However hey, you get what you pay for, amirite? And earlier than you accuse me of fear-mongering, there have been very actual discussions by numerous core contributors about altering the IBD (preliminary block obtain) default in Bitcoin Core in order that newly spun-up nodes by no means see your JPEGs within the first place.

As I write this, Luke Dashjr’s OCEAN mining pool has simply launched to a lot fanfare, and it seems that they’re purposely not relaying knowledge after OP_FALSE as a method of censoring Ordinal inscriptions.

And whereas there are some theoretical strategies of pruning Bitcoin Stamps out of the UTXO set, like UTreeXO, they’re way more invasive than discarding witness knowledge and include their very own trade-offs for full-node operators. Ordinals, magnanimously, make pruning simple whereas Bitcoin Stamps make it very arduous.

Bitcoin Stamps are much more costly to mint than Ordinals however we’ve discovered that constraints could make for good artwork. Within the phrases of Leonardo da Vinci: “Artwork lives from constraints and dies from freedom.” The artist neighborhood that’s sprung-up round Bitcoin Stamps are inclined to gravitate in the direction of pixel and SVG artwork as a result of they compress way more effectively than raster artwork, for lack of a greater time period.

The dimensions/price constraint has additionally led to more moderen innovation by recursion the place a JSON file is minted that factors to quite a lot of beforehand minted stamp “traits”. By repurposing these “traits”, the price of a big assortment is introduced down a number of orders of magnitude by stripping away the redundant knowledge throughout a group. Audio Stamps that mint solely a track’s notes (much like old-school MIDI format) and AI Stamps that mint solely a generative seed immediate are extra modern strategies that work across the constraints and ship novel outcomes.

You need fungible degen tokens? Yeah, we obtained these too within the type of SRC-20.

Wish to get entangled in Bitcoin Stamps both as an artist, developer, or collector?

There’s a thriving Telegram neighborhood full of individuals glad to reply any questions you’ll have, discovered right here: t.me/BitcoinStamps

Listed here are some hyperlinks to the ever-growing Bitcoin Stamps ecosystem:

• STAMPCHAIN.IO
• STAMPED.NINJA
• RARESTAMP.XYZ
• STAMPVERSE.IO
• OPENSTAMP.IO
• THESTAMPWALLET.COM

This text is featured in Bitcoin Journal’s “The Inscription Problem”. Click on right here to get your Annual Bitcoin Journal Subscription.