During a recent interview on “The Joe Rogan Experience,” Elon Musk, the CEO of Tesla (NASDAQ:TSLA), found himself inadvertently endorsing the potential of Bitcoin Ordinals while sharing his skepticism about non-fungible tokens (NFTs). In a bid to protect digital assets, Musk proposed storing them on-chain, which resonates with the underlying purpose of Bitcoin Ordinals. This protocol, introduced by Casey Rodarmor, enables the direct inscription of images and text onto the Bitcoin blockchain following the Taproot soft fork. Presently, there are over 38 million Ordinals inscriptions on Bitcoin’s blockchain.
Rohun Vora, the creator of DeGods and y00ts NFT projects, endorsed Musk’s viewpoint, considering Ordinals as a viable solution to address common criticisms of NFTs. Notably, OnChainMonkeys, an Ethereum-native NFT project, declared its intentions to migrate to Bitcoin due to the enhanced decentralization and security offered by the Bitcoin Ordinal protocol.
However, it’s worth mentioning that Musk’s critique of NFTs doesn’t apply universally. For instance, Larva Labs relocated its CryptoPunks NFTs onto the blockchain in August 2021 for long-term preservation.
Musk’s critique of NFTs primarily focused on the fact that many NFTs are not fully integrated into the blockchain but are essentially URLs linking to external servers hosting digital assets. This setup exposes NFT owners to risks and potential asset loss in the event that the hosting companies dissolve. Musk argued in favor of encoding JPEGs on the blockchain to enhance security and the safety of digital art. His remarks have ignited a debate within the NFT community, with some projects opting to store their assets on Ethereum’s blockchain, while others continue to rely on external servers, thereby increasing the associated risks.
In response to Musk’s comments, Bitcoin enthusiasts have actively promoted the Bitcoin Ordinals protocol, which provides a secure means of inscribing artwork and media directly onto the Bitcoin blockchain itself. This approach ensures the continued accessibility of NFTs as long as the Bitcoin network remains operational.
