In the ever-dynamic cryptocurrency industry, a wave of innovation is brewing that could have a significant impact on the bitcoin (BTC) price. We refer to the issuance of new tokens thanks to the Ordinals protocol. This development could redefine the rules of the game, reinforcing the dominant position of the Bitcoin network.
The Ordinals protocol entered the scene a few months ago and is already “stirring up the hornet’s nest” bitcoiner. It is designed to allow developers to create tokens on the Bitcoin network.. BRC-20 tokens such as ORDI, PEPEBTC and MEME have been created; and also some collectibles, including a version of the popular NFT Bored Ape.
These tokens could represent a wide range of assets, from stocks and bonds, to items in video games. As CriptoNoticias recently reported, a stablecoin has already been presented through this format. This versatility promises to open the door to endless possibilities and could lead to a significant increase in the demand for BTC (and by extension its price).
The logic is simple: Ordinals tokens are backed by bitcoin, an asset that enjoys a reputation for security and stability superior to that of cryptocurrencies created later. This endorsement would provide an additional layer of trust and attractiveness for Ordinals tokens, incentivizing their adoption.
This is not an unsubstantiated guess. Looking back, we see a similar pattern when Ethereum launched its ERC-20 token standard. The result was an impressive rise in the price of ether (ETH), a cryptocurrency needed to pay network fees. Similarly, when the BNB Smart Chain network (previously called Binance Smart Chain) became popular, the price of the native cryptocurrency, BNB, rose considerably. Therefore, it is not unreasonable to assume that the massification of Ordinals tokens, in the Bitcoin network, could have a similar effect on the price of BTC (which is the cryptocurrency used to pay commissions to miners).
It is interesting that, thanks to Ordinals —a protocol that promises to continue expanding and evolving to provide a better user experience— Decentralized Finance (DeFi) and Non-Fungible Tokens (NFT) Industries Could Find Bitcoin Their Final Home. Thus, the network created by Satohi Nakamoto would increase its dominance, taking the market away from Ethereum and its “clones”.
Markus Thielen, head of research and strategy at cryptocurrency service provider Matrixport, recently said that bitcoin needs a new bullish driver for its price to rise. Perhaps, these tokens constitute such a driver.
Although the future is inherently uncertain, by studying the past and taking a hard look at the present, some hints of where history is headed can be glimpsed. Everything indicates that Ordinals is not a fashion that is about to disappearbut with the passing of time, the tokens in Bitcoin will occupy an increasingly relevant place.
These estimates are based on pricing models and do not constitute an investment recommendation or financial advice. Each person must do their own analysis before investing in any asset. The author has invested in bitcoin, cryptocurrencies, and stocks since 2013.
Disclaimer: The views and opinions expressed in this article belong to its author and do not necessarily reflect those of CriptoNoticias.
