Article title: "Ordinals are Fiat. And Inscriptions aren’t Rare." Audio: https://fountain.fm/episode/RRvB5Te4a1P8eXOO3LY6 Article: https://medium.com/@southern_hands/ordinals-are-fiat-and-inscriptions-arent-rare-f1681b60facc

Recently I heard a podcast, a reading of an article, on bitcoin ordinals. The title was “Ordinals are Fiat. And Inscriptions aren’t Rare.” It’s a long-form article, well-written, with excellent points and I learned things, but it’s premise is simple enough:

A couple of things here: (1) I think the author has a few axes to grind that are separate from the key point, and (2) he misses the key point on NFTs and is just wrong.

In the case of this article, semantics matter. Particularly, it’s necessary here to define what an NFT actually is. I’ve offered a definition before, in short, NFTs are “verified unique ownership,” call an NFT a “VUO.”

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A few comments on each of these VUO points…

First, the Verified is likely the least controversial. With Bitcoin especially, the evidence on chain is there, open and indisputable. I’ll just leave that alone.

Secondly, the Unique is a point that people often get wrong. Those who just “don’t get” NFTs often say they can simply right-click, save as and download the jpg image of an NFT, then, they think, “I’ve got it.” This is the simplest way to look at NFTs and the most basic mistake. That image you downloaded is not the NFT, that is an image. This is no different than a paper image of the Mona Lisa is not the Mona Lisa. This is no different than a brush-stroke-for-brush-stroke copy of the Mona Lisa is not the real one. Back to the Verified, the consensus is that the real one is in the Louvre.

I believe the author feels ordinals are fiat because an unlimited number of a monkey jpeg could be minted. Okay theoretically, except…(a) the minter has finite funds to mint, so, minting monkey jpegs does have a practical limit, and (b), each of those monkey jpegs is unique…it is, in fact, non-fungible. It’s simply not the same as printing fiat paper money.

The author of the article spends a good deal of effort digging into the numbering system of ordinals. This is one of the axes being ground. He makes two points here: (1) the numbering system is arbitrary. And (2), the numbering system is not “inscribed” onto a sat, it’s in the transaction itself.

In these points, he’s right, I guess (this is something I learned from the article!). The author uses a tree and its leaves as a visual for NFTs. The left-most is sat #1 the right-most is the last sat. But, he says, the numbering could start with the right-most as #1. I suppose this is all true. But, it’s immaterial. The main thing is that, by consensus, people have chosen to number ordinals in a certain way. If they wished, they could number them in another way and that would be fine too. Remember when Bitcoin forked, back whenever that was, the community decided to follow a certain track of the fork and not to follow the other. Consensus decides the rules.

The point here is that each item is unique and we agree on how to identify it. In yet another way, if I was to count a row of ducks, it wouldn’t matter if I start counting from the left or the right. As long as we all know from which direction we start, we know know the protocol for pointing out which particularly, unique NFT I’m speaking of by its ID.

Regarding the point that nothing is inscribed onto a sat, it seems that the author has a beef with whomever wrote the Ordinals Handbook. The beef seems to be: the Handbook is deceptive about this sat-inscription point. This seems to be another axe to grind for the author. This may be right about the handbook, with or without any malice. The author points out that the the identifier is placed onto the transaction recorded into the Bitcoin blockchain, but not the sat…another axe to grind. Fair enough, but, again, this is irrelevant to whether ordinals are unique. Using the blockchain, the U in uniqueness of the ordinal can be Verified. Grinding axes and splitting hairs is well and good and has its place, but is divorced from the issue at hand: the ordinals themselves are verifiably unique.

Regarding ownership, this is where I really feel the owner is wrong. More kindly, maybe the author just doesn’t get it on NFTs. Or, perhaps, it comes down to semantics again, this time, semantics over the word “ownership.”

I define ownership here in the sense of control.

The author’s beef is that the inscription is not on the sat itself, it’s on the tx recorded on chain. You own the sat, but since you don’t own the tx, then you don’t own the ordinal NFT. Well…semantics.

I have a twenty dollar bill in my pocket. I both own the item and control what its used for…I can save it or spend it or give it. Suppose someone pickpockets me, then, both the item and control of the bill are gone from me. The thief has both. The thief owns it.

I own a car. If someone sneaks into my garage at night and steals my car? Who owns it now? The car is in possession and control of the thief. In this way, the thief owns it. Certainly, I’m the rightful owner though…the title says so. Yet, I do not have control of the car. The ledger says I own the car, reality says the thief owns the car because he controls it. The item and control have been separated and “ownership” is muddled.

With Bitcoin, it’s different. The item and the control cannot be separated.

A couple of months back, I made a recursive ordinal, number 34145265. I own the sat in my Taproot wallet. And, I control/own the ability to hodl or move that sat. If I move it to Alice, a new tx will be created. It doesn’t matter that no one owns either the old or new tx record. Now, I no longer control/own that sat, Alice does. I no longer control/own the hodling or moving of the ordinal NFT. I no longer own the ordinal NFT, Alice does.

Aside from me compromising my keys or someone hacking my wallet or me in some way, my ordinal NFT cannot be stolen. In another way, the item (the ordinal) and the control of it, cannot be separated. I own it.

Bitcoin ordinals checks all of these boxes regardless of the axes being ground.