Concerning Ordinals.

Ordinal (adj. )c. 1400, “regular; ordinary; well-regulated and proper,” from Old French ordinel, and directly from Late Latin ordinalis, “showing order”, denoting an order in succession,” from Latin ordo, genitive ordinis “row, series” (see Order (n .)).). From 1590s, it means “marking the position or place of an object within an order or series”. Ordinal numbers signify rank or position within a system, while cards numbers indicate how many units there are. Ordinals can be thought of as the number that is used to communicate a runner’s place in a race or within driving directions. “Take the third left.” Cardinals can be thought of as the numbers used to count how many jelly beans are in the big jar at fair. In bitcoin terms, the block height of a chain would be an ordinal number (10th block), whereas the transaction fee amount would be a cardinal numbers (1000 sats). Ordinals is a open-source project by Bitcoin developer Casey Rodarmor. It consists of two distinct parts: Ordinal Theory and inscriptions. Ordinal Theory is an arbitrary, but sensible framework for tracking the lineage a specific satoshi using an ordinal numbers it acquired at issuance. At the current block height, having had three halvings beginning from 50 bitcoin (, 6.25)-when an invalid block is found, the lucky miner may assign 625,000,000 Satoshis to himself in the coinbase transaction which has no input. Miners use the reserved, but otherwise empty input to increase their nonce space for hashing at current difficulty. The Bitcoin network is a collection of peer-to-peer database that contains integers that reflect the current status of the protocol. Ordinal theory can be described as a conceptual social lens that explains all the numerical data in bitcoin’s blocks. Ordinal Theory is a way to interpret Bitcoin from a unique perspective. It uses (cc: arbitrarily) rules to show how individual satoshis are distributed after a bitcoin transaction. Every satoshi receives a unique ordinal number starting at 0. and continuing until just below 2.1 quadrillion. 100,000,000 satoshi groups are commonly referred to as “a Bitcoin”. This number is determined at block issuance, regardless of the extremely rare but legitimate accounts that successful miners have created to complete the block reward-issuing Coinbase transaction output. Except for this Coinbase transaction which requires an input and output, every bitcoin transaction needs both an input AND an output. In a bitcoin transaction, satoshis of separate UTXOs (unspent transaction outputs) are completely indistinguishable. They can be spent via the output address and thus atomically fungible. Ordinal Theory merely suggests that there is an order to distribution. Satoshis are sent in a first-in, first-out manner and ordered by input. To locate rare ordinals, you can scan your bitcoin wallet for UTXOs. Rare ordinals can be either directly from consensus or from blocks issued at the time a personal event. Every number between 0 and 2.1 quadrillion has a satoshi associated with it. There are many opportunities for numerical repetitions, unique integers and interpretive iterations. A base26 equivalent, “BLOCK”, could be used by an ordinal theorist to value the interpretation of satoshi 5,412,388. “Ordinal 0.4.2, a specialized bitcoin wallet, was recently released. It programs a specific transaction and uses protocol consensus rules to inscribe any type of data into the witness chain. If it is willing to pay the market fee and propagates to a miner, then that is. This software allows anyone to buy ledger space by making it easy to access. The majority of the transactions land in witness data. SegWit, a bitcoin softfork, was created in 2017 by Luke Dashjr and Peter Wuille. It removed the signature data from transactions in a block, and placed them on a 4MB block extension. SegWit introduced a new block size metric in the form of weight units. This allowed for a distinction between bytes or vbytes (four weight units). The maximum block weight was derived by taking four times the nonwitness bytes (transaction inputs/outputs) and subtracting that from the total witness data, which includes unlocking scripts and signatures. This was done to allow previous versions of Bitcoin software to still validate transactions. However, it also increased the block size by removing the total witness data (signatures and unlocking scripts) from the block limit of 1MB set by Satoshi in the late 2010. SegWit was also created to prevent malleability attacks. SegWit divorces witness data to preserve the transaction ID. This “sidechain” was to be economically discounted at a rate of satoshis/vbytes to encourage more complex bitcoin scripts that have historically enabled scaling efforts. The Lightning Network itself requires HTLCs (or hash time locked contracts) to probabilistically enable trust and efficiency in the exponentially more efficient, shared UTXO payment channel. Taproot, a 2021 Bitcoin soft fork, enabled further op_codes, Merkelized Alternative Script Trees (MAST), with a transaction type called “P2TR”, or a pay-to-taproot script, and raised standardness bounds to data relay. SegWit was a critical leadger state-change that created the witness data block extension. Taproot was more of an update to the system that allowed for scaling and privacy features. These forks are essential to understand how Ordinal 0.4.2 works. However, the ability to pay miners to have block space for arbitrary data in bitcoin has been available since the genesis block. This is perhaps most infamously done in the OP_RETURN, which allows spent outputs to display a message or encode a key in its available 40 bytes, leaving the UTXO unspendable, but easily prunable from the UTXO set.The Ordinal software allows users to generate valid bitcoin transactions that contain arbitrary-to-its-own-script data such as text files, PNGs or even a program script itself. These transactions are signed using Ordinal 0.4.2 modified wallet software. The envelope is called an op_code and is written in the transaction’s witness information. This envelope is made using the OP_FAIL Code, which by default doesn’t push the code below it into the programming stack. The Inscription data, which contains a file type header and the file itself is placed within the OP_IF instance. It is sealed with the if_ran, end-program OP_ENDIF. This op_code makes it possible to access the Inscription data from your own node. The necessary computations to validate a script that is presumably heavy and expensive is potentially lower than a Lightning channel open. Because blocksize is static since SegWit, the implications for node runners’ fears about centralization due to increased costs of running a node are not more severe than if blocks were just routinely full; maybe even less. However, near full blocks are a normal outcome of a successful bitcoin network. This is something the network should be prepared to handle. Inscriptions can be associated with a specific transaction satoshi and could be paired with an Ordinal Theory satoshi. This simulates the Bitcoin blockchain and allows users to sentimentally value one satoshi more than another. In a particular sense, this could break fungibility if the holder of said ordinal is willing exchange it for more than its single satoshi price. This was true in all cases. It was possible with localized exchange rates of fiat pairs, market arbitrage or a poorly programmed transaction. Inscriptions and Ordinal Theory do not cause any state change in the atomic principles that make up a satoshi. It is simply a social lens. Privacy concerns are resolved in a similar way. An inscription does not contain a molecular tracer that can track your individual sat within pure functional fungibility of bitcoin transactions. They all work exactly the same, you just refer to one as such. An ordinal can be spent just like any other satoshi. Bitcoin is a database that has a specific consensus. There is nothing in Ordinal Theory or Inscriptions that would violate those rules. There is nothing against running an adversarial Node within a Lightning Route gathering metadata for surveillance, pin attacks, utilizing chain analysis software or even a Bitcoin donation scam. It is important to remember that just because something is possible to use bitcoin, it does not necessarily mean that it is a net benefit for users of the system. Bitcoin is a system that has rules and not biases. The code must be the arbiter for validity. Since Ordinal 0.4.2 was launched, the nodes that Inscribers have synchronized contain the rules for what constitutes a valid Block. The dynamic blockspace fee has established a truth-only market that is legally able to meet its economic demands. Inscriptions have the unique property of selective impermanence, which allows them to use the database and increase demand for bitcoin, the asset, and bitcoin blockspace. It is best not to rush to change the conditions that have been hard-fought for. One could have bought every block in perpetuity. If they wanted to pay the fee, someone could always stuff arbitrary data into clever transactions. You wouldn’t waste your satoshis on that. You might accidentally spend a rare one.1


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