Michael Saylor, MicroStrategy co-founder and executive chairman, has become one of the few Bitcoin maximalists to publicly embrace Ordinals.
Ordinal inscriptions are similar to NFTs, which primarily exist on rival network Ethereum. Inscriptions allow for arbitrary and non-financial information, such as images, to be included on the Bitcoin blockchain. Short for “Bitcoin Request for Comment,” BRC-20 is an experimental framework for building fungible tokens on Bitcoin using the Ordinals protocol.
Over the past couple weeks though, Ordinals and BRC-20 tokens have taken center stage as transaction fees skyrocketed. It has kicked off many discussions within the Bitcoin community over whether the network was being attacked and if these transactions should be censored.
Saylor chatted with Decrypt at the Bitcoin 2023 conference in Miami last week about Ordinals, BRC-20 inscriptions, and whether they might constitute unregistered securities.
Saylor has embraced Ordinals as a positive development on the Bitcoin network, although he said many of the early use cases “aren’t terribly serious” and veer towards being more speculative.
One of the top performing Bitcoin Ordinals collections has been Bitcoin Frogs, according to CryptoSlam. It’s a spin off of the Pepe the Frog meme coin craze that’s taken the NFT community by storm.
“If BRC-20 tokens are viewed as fungible tokens to issue unregistered securities, there’s a lot of objection to that, because it’s unethical. It’s illegal. And you can’t blame [the community] for objecting to that,” Saylor said.
However, if they are issued and regulated in an ethical and legal manner, he said, there’s no issue. It all comes down to the use case and perception.
“What if I was using them to tokenize all of the stocks and ETFs trading on NASDAQ so that individuals can take personal custody of their shares of stock instead of leaving them locked up with a centralized custodian” he said. “If it was presented that way, then Bitcoiners would love it.”
According to the MicroStrategy co-founder and executive chairman, however, he sees economically sound use cases, but he can “also imagine unethical, stupid things.”
Like many Bitcoiners, Saylor believes it’s best to let the free market function—people should invest in what they believe in and are free to criticize something they think is silly but should not work to censor them.
Despite warnings of possible unregistered security offerings and strong pushback from parts of the community, Saylor is against censoring Ordinal transactions on the Bitcoin network. “Do I think we should modify the protocol to censor certain types of transactions,” he said. “My answer is no.”
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