1️⃣What is Ordinal

Bitcoin Ordinals is a protocol that allows individual satoshis (SATs) in a Bitcoin blockchain to be assigned a unique identifier and transacted with extra data attached. (A satoshi is the smallest unit of bitcoin currency, and there are 100,000,000 satoshis in a single bitcoin.) The protocol, which is credited to Casey Rodarmor, effectively allows non-fungible tokens (NFTs) to be created directly on the Bitcoin blockchain. Bitcoin NFTs may also be referred to as Ordinal NFTs.

Until recently, bitcoins were fungible (interchangeable), and one satoshi on a blockchain could not be differentiated from another. Rodarmor’s protocol changed that by taking advantage of two updates to the original Bitcoin protocol: Segregated Witness (SegWit) and Taproot. Taproot introduced a new type of Bitcoin address format that the Bitcoin Ordinals protocol uses to identify specific satoshis. The Segregated Witness update allowed witness information (also known as witness script) to be decoupled from transaction data and stored in a separate data structure on the blockchain. This change increased Bitcoin’s block size and made it possible for users to inscribe image and video data in the witness script along with digital signatures and other validation information.