Bitcoin Inscriptions: The Power of Satoshis

Ketan Gupta
5 min readFeb 17, 2023
Bitcoin NFTs Ordinals and inscriptions

Bitcoin is known for being a digital currency, but there is more to it than just simple transactions. Satoshis, the smallest unit of bitcoin(1 satoshi = 0.00000001 BTC), can be imbued with meaning and unique identities through ordinals and inscriptions.

What are Ordinals?

Ordinals are a numbering scheme for satoshis that allows tracking and transferring individual sats. These numbers are called ordinal numbers. Satoshis are numbered in the order in which they are mined and transferred from transaction inputs to transaction outputs first-in-first-out. This allows for the unique identification of each satoshi and enables the use of inscriptions.

Inscriptions inscribe satoshis with arbitrary content, creating unique digital artifacts that can be held in bitcoin wallets and transferred using bitcoin transactions. These inscriptions can be created with different content types, similar to MIME types used on the web, and are stored on-chain in taproot script-path spend scripts. These inscriptions do not require a sidechain or separate token, making them a natural extension of the Bitcoin network.

Bitcoin NFTs and difference from traditional NFTs:

Inscriptions are not just simple text or image files, they are bitcoin-native digital artifacts, more commonly known as NFTs. However, unlike other NFTs that require separate infrastructure and tokens, inscriptions are simply bitcoin transactions that control the order and value of inputs and outputs according to ordinal theory. This makes inscriptions more secure, immutable, and decentralized than other NFTs.

The power of inscriptions is in their ability to create unique, one-of-a-kind digital assets that can be traded and collected. Inscriptions can be used to create art, music, literature, and any other type of digital content that can be stored in a byte string. This content can be returned from a web server, allowing for the creation of HTML inscriptions that use and remix the content of other inscriptions.

Inscriptions are also relatively economical due to the witness discount received by taproot scripts, and the ability to store the content in relatively small script-path spend scripts. Inscriptions are made using a two-phase commit/reveal procedure, with a taproot output committing to a script containing the inscription content in the commit transaction and spending the output in the reveal transaction, revealing the inscription content on-chain.

Overall, bitcoin inscriptions provide a new way to create and exchange unique digital assets, while still leveraging the security and decentralization of the Bitcoin network. With the power of ordinals and inscriptions, satoshis become more than just a unit of account, they become a canvas for creativity and expression.

Video Reference

Concerns around Bitcoin NFTs:

Bitcoin inscriptions and NFTs have the potential to introduce concerns and challenges for the Bitcoin network and its users. Here are some of the concerns:

  1. Transaction backlog: As the popularity of inscribing and trading NFTs on the Bitcoin network grows, it could create a transaction backlog and increase the fees required for faster confirmation times. This could make it more expensive and difficult for regular Bitcoin users to transact on the network.
  2. Increased storage and bandwidth requirements: The storage and bandwidth requirements for running a full Bitcoin node could increase due to the addition of large amounts of NFT and inscription data being added to the blockchain. This could make it more difficult for regular users to participate in the network and could also make it more expensive for node operators.
  3. Illegal content: As with any form of digital content, there is the possibility that illegal material could be recorded into Bitcoin’s blockchain through inscriptions. This could potentially discourage some users from running a Bitcoin node and could also create regulatory concerns.

It's worth noting that these concerns are not unique to Bitcoin inscriptions and NFTs, but rather are general concerns associated with the growth and adoption of new technologies. As the technology develops and adoption grows, these concerns will need to be addressed by the Bitcoin community.

Here’s a brief how-to guide for creating and using Bitcoin inscriptions:

  1. Obtain a Bitcoin wallet that supports inscriptions — Currently, the only wallet that supports inscriptions is the Ordinals wallet, which you can download from the project’s GitHub page. Make sure to follow the wallet installation instructions carefully.
  2. Fund your wallet with Bitcoin — Once you have the wallet installed and set up, you’ll need to fund it with some Bitcoin so that you can create and send inscriptions.
  3. Create an inscription — To create an inscription, you’ll need to specify a content type (e.g. text, image, video) and provide the content itself as a byte string. You can do this using the Ordinals wallet’s built-in inscription creation tool.
  4. Send the inscription to someone else — To send an inscription to someone else, you’ll need to create a Bitcoin transaction that includes the inscription as an output. The recipient can then access the inscription by spending the transaction output using their own Ordinals wallet.
  5. Explore inscriptions on the blockchain — You can also explore existing inscriptions on the Bitcoin blockchain using the Ordinals block explorer. This allows you to see what kinds of inscriptions other people have created and shared.

More detailed guide:

Keep in mind that creating and using Bitcoin inscriptions does come with some potential drawbacks, such as reduced accessibility to transact on Bitcoin due to potential transaction backlogs and increased storage and bandwidth requirements. Additionally, there is a possibility of illegal material being recorded into the blockchain, which might discourage some users from running a Bitcoin node.

Despite these concerns, Bitcoin inscriptions and NFTs created using ordinals offer a unique and Bitcoin-native way to create, share, and collect digital assets. By following the steps above and taking proper precautions, you can explore this new frontier of the Bitcoin ecosystem.

Thank you for reading this article on Bitcoin inscriptions and ordinals. We hope it has been informative and helpful in understanding the potential of Bitcoin for creating unique, blockchain-native digital artifacts. If you’re interested in learning more about the intersection of blockchain and NFTs, be sure to follow us for more tech content on this exciting topic. Stay tuned for more updates and insights on the future of decentralized technologies!


  1. Ordinals website:
  2. Ordinals Github repo:
  3. Bitcoin Taproot:
  4. Bitcoin Wiki:



Ketan Gupta

Blockchain enthusiast and writer exploring crypto, NFTs and decentralized tech. Providing fresh perspectives and thought-provoking insights. Follow for more.