Execs Ease Selection Between Bitcoin Ordinal & Off-Chain Storage

Both on-chain and off-chain storage of NFTs (non-fungible tokens) have their own merits and demerits. However, a Web3 mogul encouraged the developers to decide which kind of NFT requires a place in the blockchain and which is required to be kept outside the chain. 

Bitcoin Ordinals versus off-chain NFT storage: Execs explain how to choose

Before 2023, non-fungible tokens were not stored on the blockchain, as per the opinion of Jana Bertram lead of strategy at Rari Foundation. The major issues with these types of NFTs came in the limelight during the unprecedented demise of FTX, a crypto exchange established by Sam Bankman Fried. 

At the time of FTX collapse, the NFTs available on FTX were reflecting a black image, rather than the original work. However, the establishment of Bitcoin Ordinals changed the entire scenario. 

Following the entry of Ordinals, now the NFT data is stored on the blockchain and originates several trade-offs. Starting from the 2021 end till mid-2023, the NFT market was on the boom and was performing beyond expectations. 

Mirroring the upgradation, now there are several options available. Its developers call to choose the appropriate destination where to place their NFTs.     

Witek Radomski, co-founder and CTO of Atlas Development told a key cryptocurrency media outlet that off-chain storage is the most cost-effective way to handle large amounts of data. On the other hand, on-chain storage might function as a “permanent, tamper-proof vault.”

Radomski added:  “I think developers ought to determine what needs the vault treatment and what can exist in the cloud.”

Radomski further stated that a hybrid solution, such as Filecoin and the InterPlanetary File System (IPFS), enables a decentralized storage alternative. The chief executive officer stated that, unlike Bitcoin, these solutions are intended for storage. “Storing images in IPFS still gives you the benefits of decentralisation, but with much lower costs,” he went on to say. 

However, some other analysts think that the non-fungible token should reside on-chain or not should be decided by its purpose. After surging crypto adoption, the global NFT sector has shown significant growth.

NFT Industry Insights.

Almost every sector in the decentralized world has shown significant growth in 2023, and NFTs have also reflected a sudden increase in user base. The 2023 NFT market volume reached $13.12 billion, down from the previous year’s peak.

The market is projected to increase at a CAGR of around 34% by 2030. December was a tremendous month, with a 32.3% increase in trade volume to $852.2 million.

The market capitalization of NFTs also demonstrated resilience, beginning at $5.24 billion and rising 6.5% to $5.58 billion.

Disclaimer

The views and opinions stated by the author or any people named in this article are for informational ideas only and do not establish financial, investment, or other advice. Investing in or trading crypto or stock comes with a risk of financial loss.

Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.