20th February 2023 > > Ordinals part II.

tl;dr

I have tempered somewhat yesterday’s enthusiasm for Ordinals.

Market Snap

Market Wrap

There was some interesting price action yesterday. A brief foray above $25k was met with decent sized selling. A brief dip to $24k was met with decent sized buying. Techies are unsure whether this means we have a firm support, or a firm resistance though they are very excited that both the 200-week moving average and the 50-week moving average are both very close to current prices. And here are two lines drawn on a BTC price chart that are getting some attention:

It is just a squiggle and gives zero information about future price moves, but at least it keeps those who are discussing it in depth off the streets.

Curious Cryptos’ Commentary – Ordinals part II

Having mulled over my enthusiasm yesterday for Ordinals, I now realise that there potentially some major problems afoot. Let me explain.

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There are three clear problems with the implementation of Ordinals.

The first is an obvious one, and we all know examples of in a different setting.

Drunken, and other inappropriate comments on social media can be devastating to an individual’s reputation. But when something has been taken out of context (one person’s satire is another persons’ prison sentence) or a mistake has been made (for whatever reason) there is a process of correction that can be used when dealing with centralised social media organisations.

Post an Ordinal message on the BTC blockchain, that aint changing, not ever. That is a long time in which to contemplate an ill-advised and badly thought through Ordinal.

I must admit that during my exploration of the Ordinal creation tool by Gamma (https://gamma.io/ordinals) it occurred to me that if someone had a soon to be ex-wife who had cheated on them during their short marriage, it might be tempting to inscribe forever more the names of those who had participated in the extramarital liaisons.

Remember, it’s not libel when it’s true.

But it’s possible some of those third parties still have their own partners and families. Better to not be a revengeful person and ruin their settled, domestic lives.

This problem works the other way round too.

Someone can anonymously post a libellous statement, the source of which remains hidden. Given the spiteful nature of some of the debates on social media, I see plenty of opportunities for this functionality to be abused.

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The second problem concerns copyright.

This is already a thorny issue with NFTs (non-fungible tokens) created on other networks.

There have been many examples of copyright infringement. Our very own Head of Technical Analysis, the indomitable Larry Bloch, created a satirical collection of NFTs posted for view and sale on opensea.io.

I would love to give the link, but the collection has been taken down by the site.

And in most respects – and this was the satirical point I believe of Larry’s collection – this was a clear case of copyright breach.

How’s that court case going, Larry?

Ordinals allow someone to infringe copyright laws, monetise that infringement, and potentially remain forever anonymous.

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The third problem is the most chilling.

It is theoretically possible that an individual or group could post explicit and harrowing images. Terrorist groups like ISIS have already circulated graphic videos of beheadings. Encrypting that forever more on the blockchain is a very scary prospect.

Individuals with a twisted and warped mindset may be able to post other disgusting images.

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There is an obvious solution.

BTC miners must become censors of the data they put into each block. Ordinals are easy to identify with a specific piece of coding within. All Ordinals will have to be put through a moderator, who then makes a subjective judgement as to which are acceptable, and which are not.

This is very far removed from Satoshi Nakamoto’s original concept of a decentralised and trustless system.