Bitcoin Ordinals inscriptions are witnessing a waning trend, notwithstanding the growing enthusiasm for Bitcoin exchange-traded funds (ETFs) and the imminent halving event.
The month of January saw a significant drop in Monthly Ordinals sales, plummeting by 61% to $335 million, compared to the pinnacle of $868 million recorded in Dec—the highest-sales month in Ordinals history, as reported by NFT data aggregator CryptoSlam. Ordinals represent the initial form of nonfungible tokens (NFTs) minted on the Bitcoin network.
Anndy Lian, an intergovernmental blockchain expert and author of the book “NFT: From Zero to Hero,” attributes the decrease in Ordinals sales to the oversaturation of the NFT market and the influx of collections from various blockchains.
Buyers are now presented with many options as the space sees a surge in new projects and artists. The abundance of choices became more pronounced as other blockchains, such as Solana, gained momentum.
Despite a 2.2% decline in monthly Ethereum NFT sales to $355 million, NFT sales on Avalanche experienced an 89% increase, reaching $46.7 million in January, up from $24.7 million in December.
Most of the sales volume on the Avalanche network was attributed to Dokyo NFTs, with the collection contributing $31.4 million in January, constituting 67% of the blockchain’s monthly sales. In contrast, Dokyo generated only $7.64 million in sales in December. Dokyo, a collection of 5,555 NFTs, was launched by the pseudonymous creator 0xBrando.
Dokyo NFT sales witnessed a significant upswing in Nov, with its 24-hour sales volume surpassing that of the Bored Ape Yacht Club on Nov. 24. This brief period marked Dokyo as the most traded NFT collection across all blockchains. Furthermore, on Jan. 15, according to CryptoSlam data, Dokyo claimed the top spot on the sales leaderboard.
Ordinals Sales Decline Amidst Bitcoin Trends
Lian indicates that ordinals sales faced challenges from other NFT collections. The contentious reputation within the Bitcoin community and their technical complexity played a role in influencing these sales.
“The introduction of Ordinals has stirred controversy within the Bitcoin community, with some viewing the activity akin to spam email. This may have impacted the reputation and credibility of Ordinals among certain Bitcoin enthusiasts.”
Conversely, Sebastien Guillemot, co-founder of Paima Studios, a Web3 gaming engine, mentioned that the attention previously directed towards Ordinals is shifting towards Bitcoin layer-2 solutions. Guillemot stated:
“Numerous individuals involved with Ordinals have transitioned their focus to Bitcoin layer 2s, particularly amidst the excitement surrounding BitVM and OP_CAT. It wouldn’t be surprising if developers and investors are pivoting towards this narrative.”
Despite declining sales, the number of Ordinals inscriptions continues to increase. As per Dune data, there are more than 59 million ordinal inscriptions on the Bitcoin network.
Could The Bitcoin halving spark A resurgence In interest In ordinals?
In tandem with the decline in sales, the average Ordinals sale price dropped by 25% to $1,340 in Jan, down from $1,793 in December. Despite this decrease, major crypto firms remain interested, exemplified by Binance, the world’s largest crypto exchange, unveiling its Ordinals marketplace on Feb. 1.
Lian anticipates that the upcoming Bitcoin halving will revive interest in Ordinals. He expressed:
“The diminished supply of Bitcoin could elevate the value and scarcity of each satoshi, enhancing the attractiveness of Ordinals as distinctive and collectible assets. Moreover, the halving might escalate transaction fees on the Bitcoin network, incentivizing miners to process Ordinals transactions and bolstering the network’s security.”
In its 11th edition of the “State of Crypto” report released on Feb. 1, 21Shares, the world’s leading crypto exchange-traded product (ETF) provider, stated that Ordinals could present additional use cases for Bitcoin beyond its role as a store-of-value asset:
“We anticipate that innovations such as Ordinals and BRC-20 tokens will stimulate increased demand for Bitcoin and broaden the range of use cases on the network.”
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The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.
