When the focus shifts to Bitcoin NFTs, which projects are worth paying attention to?

Written by: Decrypt, Andrew Hayward

Translated by: Odaily Planet Daily Translator | Moni

Recently, Bitcoin NFTs have become a hot topic in the Web3 world.

At the end of January, the NFT protocol "Ordinals" officially launched on the Bitcoin mainnet, allowing users to create Bitcoin versions of NFTs, which are described on the Bitcoin network as "digital artifacts," supporting content in JPEG, PDF, video, or audio formats. Similar to the early Ethereum chain NFT projects, the Ordinals Protocol can help many projects mint NFTs on the Bitcoin blockchain.

According to Dune Analytics, as of February 10, the cumulative minting volume of Ordinals protocol NFTs has reached 47,772, showing rapid growth.

So, what Bitcoin NFT projects are worth paying attention to right now?

1. Ordinal Punks

Ordinal Punks was launched on the Bitcoin blockchain in late January 2023 and is possibly one of the most talked-about Bitcoin on-chain NFT projects. It consists of 100 pixelated avatars that have been minted on the Bitcoin blockchain through the Ordinals protocol in an "inscription" manner and can be traded. However, unlike some Punks clones seen in the past, Ordinals Punks are not direct copies of the original CryptoPunks series.

The crypto community believes that Ordinal Punks is based on a derivative Ethereum collection called Mutant Punks— in other words, it is a derivative of a derivative. However, sources connected to the project revealed that the open-source algorithm used for Ordinal Punks is actually similar to the "CCo Punk sprites" and is also based on that algorithm to generate new Punks.

This Wednesday (February 8), an Ordinal Punk was sold for 9.5 BTC, reaching a price of $215,000, which is double the floor price of CryptoPunks (the current floor price for CryptoPunks is 64 ETH, approximately $106,000). On the same day, an anonymous NFT investor named dingaling claimed on social media that they purchased 7 Ordinals Punks for 15.2 BTC, totaling about $349,000.

Of course, Original Punks still have a significant gap compared to the industry-leading CryptoPunk, as CryptoPunk #5822 once set a record price of 8,000 ETH (approximately $23.7 million).

2. Bitcoin Punks

On February 9, the NFT project Bitcoin Punks, based on the Bitcoin mainnet Ordinals protocol, completed its minting, totaling 10,000 pieces. According to the official introduction, Bitcoin Punks is the first project to successfully upload the original Ethereum CryptoPunks to the Bitcoin blockchain using Ordinals, and all assets have been minted for free by collectors. According to its development team, they are checking the hash values of each image uploaded to Ordinals and comparing them with the original 10,000 Crypto Punk images. The link pointing to Bitcoin Punks must be the first occurrence of the inscription, which must also contain the corresponding hash value on the Ordinals protocol.

It is reported that the minting cost of Bitcoin Punks is about $25, but there is currently no over-the-counter (OTC) trading. There are reports that after the minting transaction was completed, the secondary market price of the NFT reached over 1 Bitcoin, which is up to a hundred times the cost price.

However, it is still unclear how much trading demand there is for the Bitcoin Punks series, and it is uncertain whether minting will be expanded in the future. The moderators on the project's official Discord server have also warned holders to "trade cautiously" until the code audit is completed.

3. OnChainMonkey

The NFT project OnChainMonkey has also joined the Ordinals protocol and launched "inscription" minting on the Bitcoin blockchain. Currently, its collection of 10,000 NFTs has all been put on-chain, and with the previous 10,000 "copies" of CryptoPunks, Bitcoin Punks have also been minted on the Bitcoin blockchain, driving the Ordinals protocol NFT minting volume to over 20,000 on February 9 alone.

OnChainMonkey is an NFT series launched by the NFT startup Metagood, aimed at giving community members the opportunity to promote and fund social welfare projects through its DAO. Last December, the company completed a $5 million pre-seed round of financing, with investors including Animoca Brands, Morgan Creek Capital founder and CEO Mark Yusko, and Virgin Group investment manager Freddie Andrewes.

Conclusion

It is important to note that since the Ordinals protocol has just been launched, its functionality is different from "traditional" NFTs on other platforms (such as Ethereum and Solana), so there is still not much infrastructure to support trading NFT assets on the Bitcoin blockchain at this stage. In other words, there is currently no dedicated market for Bitcoin NFTs based on Ordinals. (Odaily Planet Daily notes that some BTC NFT market exploration attempts have emerged this week, and we will introduce them after observing for a while.)

In fact, such transactions are currently conducted directly between users or through custodial services in over-the-counter (OTC) trades, tracking asking prices and bids through online spreadsheets. All of this is facilitated through Twitter and Discord, as collectors are vying for these Punks clones, with some expecting these early Bitcoin "inscriptions" to prove increasingly valuable over time.

However, the lack of infrastructure means that the current trading model is vulnerable to scams. Some crypto Twitter users have already raised alarms, such as the anonymous NFT collector TheNorwegian, who suggested that the Bitcoin on-chain NFT series could trigger some scams. For example, the NFT series of cloned versions of CryptoPunks is quite common, and you can find them anywhere—such as on Solana, Polygon, Cardano, Algorand, and even Stacks (a "1.5 layer network" built on Bitcoin).

Frankly speaking, the emergence of Bitcoin NFTs has indeed put some competitive pressure on Ethereum, especially since Bitcoin has rolled out SegWit in 2017 and Taproot in 2021. These infrastructure upgrades can fully support NFT use cases, and the future NFT market may no longer be dominated solely by Ethereum.