Inquired about NFTs during a podcast, Elon Musk particularly mocked projects whose images “aren’t even stored on the blockchain”. It didn’t take much for Bitcoin (BTC) enthusiasts to see this as a spotlight on the famous Ordinals. Is this a sign of a paradigm shift in NFTs? We explain.
Elon Musk takes on NFTs…
The inimitable Elon Musk, known for his sometimes surprising media outings, has once again got people talking. During a recent appearance on “The Joe Rogan Experience” podcast, broadcast on October 31, he mocked non-fungible tokens (NFTs), pointing out that he doesn’t even really use blockchain:
“The funny thing is, the NFT isn’t even on the blockchain, it’s just a URL to the JPEG. “
Tesla’s famous CEO goes on to explain that NFT projects should at least encode the image file directly on the blockchain. Indeed, “if the company hosting the image goes bankrupt, you lose the image. “
Elon Musk is an on-chain maxi pic.twitter.com/imC8eYvLtK
– nft now (@nftnow) October 31, 2023
And makes the case for Bitcoin Ordinals
A review that could have ended there, but that wasn’t counting the fervor of Bitcoin’s (BTC) defenders. Ironically, the community saw in Elon Musk’s review an indirect plea for Ordinals, also nicknamed “Bitcoin’s NFTs”.
Indeed, Ordinals is a protocol launched last January, the aim of which is to permanently and immutably inscribe data on the Bitcoin blockchain. In simple terms, the idea is to associate the content to be stored (in this case, the NFT images) with a satoshi, the smallest unit of Bitcoin.
In other words, contrary to what Elon Musk may imply, the images are actually stored on the blockchain and not on a third-party host. Many Ordinals advocates responded to this intervention, including Rohun “Frank” Vora, creator of the famous DeGods and y00ts projects:
“This is why Ordinals will continue to grow. It’s the most elegant solution to one of the most recurrent criticisms of NFTs. “
A developer on Ordinals, known by the pseudonym “Leonidas”, even wrote Elon Musk’s 19-second excerpt on the Bitcoin blockchain, precisely at block 814 773.
Inscription Ordinals of Elon Musk’s speech on NFTs, at Bitcoin block 814 773
Debates to be nuanced
While Ordinals are a pertinent solution to one of the major problems facing NFTs, Elon Musk’s words need to be qualified. In reality, although rare, it is possible to store NFT images directly on the blockchain.
In fact, this has been one of the most striking trends for NFTs in 2021. Projects such as Art Blocks, Loot, Onchain Monkey and Nouns have been exceptionally popular because their metadata and images are stored on Ethereum.
So why don’t NFT developers do this systematically? Quite simply because it’s extremely expensive. It is estimated that a fully on-chain NFT collection could cost several tens of Ether (ETH) to create during the previous bullrun.
