During a recent appearance on The Joe Rogan Experience, Tesla CEO Elon Musk made comments that appeared to be critical of non-fungible tokens (NFTs), stating, “The funny thing is the NFT is not even on the blockchain — it’s just a URL to the JPEG.” Musk argued that NFT projects should at least embed the JPEG image in the blockchain to ensure its permanence, especially in cases where the company hosting the image goes out of business.
Musk’s remarks generated conversations on social media, with Bitcoin proponents pointing out that his comments inadvertently highlighted the value of Bitcoin Ordinals, also known as Bitcoin NFTs. Bitcoin Ordinals, launched in January by developer Casey Rodarmor, were made possible by the Taproot soft fork in November 2021. These Bitcoin NFTs are inscriptions that permanently exist on Bitcoin’s blockchain.
Cryptocurrency analyst Will Clemente praised Musk’s comments, noting that there are already 38 million Ordinals inscriptions on Bitcoin’s blockchain. This aspect was considered a strong point for Bitcoin Ordinals, as they provide an elegant solution to one of the criticisms frequently raised against NFTs.
A developer known as “Leonidas” was so pleased with Musk’s comments that they inscribed a 19-second video into Bitcoin’s blockchain at a specific block.
It’s worth noting that Musk’s criticisms of NFTs are not entirely applicable to all NFT projects, especially those on the Ethereum network. For instance, Larva Labs moved its CryptoPunks NFTs onto the Ethereum blockchain in August 2021 after residing off-chain for the initial four years. The move aimed to secure the long-term survival of the CryptoPunks images and attributes and make them accessible to anyone with an Ethereum client.
Meanwhile, Metagood, the team behind the Ethereum-native OnChainMonkeys, announced their intention to migrate NFTs to Bitcoin, emphasizing Bitcoin’s network security and design for decentralization.
Although Bitcoin Ordinals offer a promising solution, Ethereum remains the dominant platform for NFT trading, accounting for 84% of all NFT trading volumes, according to data from CoinGecko. Bitcoin and ImmutableX claimed second and third places, with market shares of 11% and 2.5%, respectively, as of June.
