Bitcoin Market Cap May Travel Through A Golden Trail With These 3 Projects
Amidst the turmoil the cryptocurrency industry has been involved in over the past month, the global market capitalization has dropped from the psychological level of $1 trillion; Bitcoin followed the trend. The largest cryptocurrency by market cap has dropped from $445 billion to $420 billion.
Over time, BTC’s usefulness has been reduced as a store of value and transfer of value. However, the emergence of BTC Decentralized Finance (DeFi) protocols is trying to further convert the usefulness of this network by expanding its use cases with the arrival of the Ordinals protocol.
Bitcoin Ordinals or Bitcoin-based NFTs can be crucial in sustaining and developing the economy of the largest cryptocurrency in the ecosystem. Although, in an essential step towards activating the Bitcoin economy, some projects focus on expanding and growing the market capitalization of BTC.
What are ordinals and how they can change the BTC economy
According to for cryptocurrency research firm Delphi Digital, more than 365,000 Bitcoin ordinals were minted “in a minting frenzy,” pushing BTC network activity to new heights.
For many, Bitcoin ordinals can be considered NFTs, but the two differ. NFTs are created and tracked through smart contracts, usually hosted on decentralized storage systems, as a modular set of protocols for organizing and transferring data – the Interplanetary File System (IPFS).
Ordinals, on the other hand, are entered into the Satoshi on-chain storage, validated in blocks, and stored in the network’s distributed ledger.
However, according to Delphi Digital, ordinal theory assigns a unique number to each satoshi, the smallest denomination of BTC, 1 BTC equals 100,000,000 satoshis. It allows the inscription of metadata on each sat, functionally turning them into NFTs, increasing the interest of “big players” after the recent Yuga Labs twelve-time auction.
Projects that will reveal the potential of BTC
Rollkit will introduce a module for Bitcoin where “Sovereign Rollups” can manage their execution. At the same time, these rollups will be able to deposit consensus and data availability for BTC.
Rollkit is a modular framework for rollups created by the Celestia team, the first modular blockchain network for secure web3 applications, which allows developers to connect custom layers of execution and data availability.
Furthermore, Stacksa BTC layer for smart contracts whose goal is to “unlock the Bitcoin economy”, features a consensus mechanism called Proof of Transfer (PoX), an extension of the Proof of Bur mechanism.
Users of this tier can pay fees to miners on STX, the native stack token of the Blockstack decentralized computing platform, to send transactions or deploy smart contracts on stacks.
According to Delphi Digital, the project aims to “bridge” BTC via sBTC, a version of BTC that lives on the stack and is pegged 1:1 to the BTC used to create it. The aim of sBTC is to be as close as possible to native BTC to enhance its on-chain functionality. Delphi Digital concluded:
Ordinals, Stacks and Rollkit are potentially the start of a vibrant on-chain Bitcoin ecosystem. These projects represent a new path for Bitcoin: one that is more than just digital gold.
For Ben Lilly, co-founder of Jarvis Labs and economist, BTC ordinals represent a shift in the demand curve of the network, allowing users to be more productive using the network. For Lilly, this is what a healthy, growing economy “looks like,” he said:
Bitcoin economy is in an uptrend
Unsplash resource image, chart from TradingView.com.