Ordinal Theory
Last updated
Last updated
In practice, Ordinals are based on a theory called "Ordinal therory".
First, we must start with understanding 'Ordinal Theory' created by @rodarmor, a way to label/identify individual satoshi's (100,000,000 sats = 1 BTC) on the Bitcoin network. With this theory, each satoshi has a unique number in order of its creation, starting with index 0 and proceeding in the order in which the coins are mined. This numbering is called "ordinal number" or "ordinals", which refers to the mathematical sense of the term that specifies the rank of an object belonging to a set. Now with the ordinal numbering system, there is a way to track data inscribed to individual sats and their owners.
This data is stored permanently on-chain and can not be modified once inscribed.
A couple of facts:
There are no smart contracts
Inscriptions are 'wrapped' in sats for 'postage', so some wallets will not charge a transaction fee.
Taproot (ordinal supported BTC addresses) start with bc1p...
This is not the first time data has been stored on BTC.