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Recursive Inscriptions: Elevating Ordinals to the Next Level

Intermediate
web3
Blockchain
Bitcoin
Explainers
Mar 4, 2024
8 min read

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The pioneer of blockchain technology, Bitcoin (BTC), was never supposed to have smart contract functionality. Its primary purpose, as defined by the blockchain’s mysterious founder, Satoshi Nakamoto, was to facilitate secure and anonymous digital asset transfers and storage. This philosophy was thoroughly rattled in early 2023 with the introduction of the Bitcoin Ordinals protocol, which made it possible to inscribe pieces of data onto minuscule portions of a Bitcoin (called satoshis), opening up the prospect of using smart contracts on the chain.

The advent of Ordinal inscriptions paved the way for another key innovation, recursive inscriptions, which facilitate the storage of potentially vast amounts of data on the Bitcoin network. As a result, a plethora of potential use cases — such as gaming, advanced 3D animation and video, and decentralized finance (DeFi) applications — have become feasible.

This new technology represents nothing less than a major paradigm shift, one in which crypto traders may soon engage in coin swaps on Bitcoin as easily as they do on Ethereum (ETH) or other smart contract chains, along with other use cases. In this article, we’ll take a closer look at recursive inscriptions — possibly the most profound innovation to Bitcoin since the day of the blockchain’s birth some 15 years ago.

Key Takeaways:

  • Recursive inscriptions are an extension of the standard Ordinal inscription technology on Bitcoin. Unlike standard Ordinal inscriptions, however, recursive inscriptions can also retrieve data from existing inscriptions.

  • By chaining together multiple recursive inscriptions, developers can work around the limit of 4 MB per inscription, potentially allowing them to store enormous amounts of data on the Bitcoin network.

  • Recursive inscriptions open up potential use cases for Bitcoin’s network, such as 3D animation and images, videos and movies, DeFi and other app types, gaming and more.

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What Are Ordinal Inscriptions?

If you have some Bitcoin lying around in your crypto wallet, you’re likely to be in possession of a huge number of satoshis — the smallest units in a BTC coin — no matter how modest your Bitcoin holdings are. Each Bitcoin is made up of 100 million of these satoshis. In December 2022, blockchain developer Casey Rodarmor realized that each satoshi on the network could be uniquely identified by the positional number within its transaction block and the time when the block was mined.

Moreover, any form of data or content, such as images, text, videos or programming code, can be inscribed onto a satoshi and stored on the Bitcoin network. The satoshi's unique and traceable nature, coupled with the customized data inscribed onto it, yields a crypto asset that’s essentially similar to a non-fungible token (NFT). 

In January 2023, Rodarmor launched the Ordinals protocol, which facilitates the creation ofBitcoin NFTs based on inscribing custom content onto satoshis. Ordinal inscriptions (aka Bitcoin NFTs) based on Rodarmor's protocol are pretty different from standard NFTs used on Ethereum, Solana (SOL), Cardano (ADA) and other smart contract blockchains. Unlike these standard NFTs, Ordinal inscription–based Bitcoin NFTs don’t require smart contracts.

Moreover, Ordinal inscriptions store all of an NFT’s metadata — ownership information, mint date, edition number and other key details — as well as the actual artwork directly on the Bitcoin blockchain. In contrast, standard NFTs typically store only the token’s metadata on-chain, with the actual artwork often stored on external platforms like IPFS or Web 2.0 cloud solutions.

What Are Recursive Inscriptions?

Recursive inscriptions use the process of retrieving existing inscriptions to form new inscriptions, which are then chained together via a complex data call mechanism. As noted above, Ordinal inscriptions keep all of the data, including the inscribed content, directly on the Bitcoin chain. Due to Bitcoin’s block size limit of 4 MB, that’s the maximum you can inscribe onto a satoshi when creating a Bitcoin NFT. While 4 MB sounds ample for short textual data or ordinary 2D images, it quickly becomes very limiting if you need to inscribe longer videos, rich 3D animation or large blocks of programming code.

Rodarmor addressed this limitation in June 2023 when he introduced an exciting update to his original inscription technology — recursive inscriptions. When they’re created on the network, recursive inscriptions can reference content inscribed onto existing inscriptions on the chain. Using a reference to inscriptions created earlier, recursive inscriptions allow you to utilize more content per Bitcoin NFT. By chaining multiple inscriptions this way, you can potentially include a massive amount of data.

By doing away with the 4 MB size limit, recursive inscriptions open up numerous new opportunities and use cases on Bitcoin, such as rich 3D video and animation, blockchain games, on-chain cinemas — and even decentralized apps (DApps) utilizing embedded smart contract code.

How Do Recursive Inscriptions Work?

Rodarmor’s idea for recursive inscriptions stems from the long-established concept of recursivity, familiar to many programmers. In programming, recursivity refers to the ability of a piece of code — e.g., a function block — to refer to itself and draw data from previous iterations of the code. The Ordinals creator made an ingenious observation that this concept can be eloquently applied to the process of creating an inscription-based token on Bitcoin.

When a new recursive Ordinal inscription is created, it includes a call to retrieve data from an earlier inscription’s content. In this way, multiple recursive inscriptions chained one after another can allow one Bitcoin Ordinal to utilize a large amount of data.

The critical aspect in this process is that the final inscription in such a chain doesn't have to fully import the data included in the other inscriptions; that would defeat much of the purpose of the entire recursive inscription concept. Instead, it can be designed to reference earlier data and execute some programming code contained in it in a lightweight and efficient way.

Let's consider an example of a large, high-resolution image that’s well over the 4 MB limit of ordinary, non-recursive inscriptions. Instead of including the image file or portions of it, an inscription could simply contain programming code that dynamically creates the image upon being retrieved from another inscription. By calling for and chaining together snippets of code from multiple inscriptions, you can construct the image, which could be several hundreds of megabytes or even gigabytes — all while not violating the cap of 4 MB per individual inscription token/satoshi.

Naturally, such lightweight, efficient code execution opens up opportunities not only for image construction but for other use cases that involve dynamic code execution. This creates opportunities for Bitcoin-based games, DeFi apps and other types of DApps currently facilitated by smart contract code on other blockchains.

While recursive inscriptions can channel on-chain data from previous inscriptions, referencing external content outside of the blockchain — referred to as sandboxing in the Ordinals protocol terminology — isn’t permitted. One important reason for this is that off-chain data can introduce vulnerabilities to Bitcoin’s self-contained security mechanism. A file stored somewhere on a personal network, or even on a well-known Web 2.0 cloud solution, isn’t the best candidate to be part of a platform that prides itself on its security features.

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Pros and Cons of Recursive Inscriptions

Ordinal inscriptions, and in particular, recursive inscriptions, might be described as the most profound new feature of Bitcoin since the network’s launch in 2009. The key pros of recursive inscription technology are as follows:

  • Inscription of large-size data — The opportunity to inscribe large-size data that enables on-chain storage of high-resolution images, videos and 3D animation.

  • Efficient data storage —Data is stored effectively, using lightweight programming code calls instead of actual media files.

  • Facilitation of DApp creation — The ability to inscribe complex programming code and data calls between recursive inscriptions creates opportunities for DApps on Bitcoin.

  • Reductions in network congestion and costs —Streamlined data exchanges among inscriptions offer the potential for decreased network congestion and transaction fees, as compared to traditional, non-recursive inscriptions.

However, while recursive inscriptions present exciting opportunities and potential use cases, there are also drawbacks associated with this major Bitcoin innovation. Some cons and risks of recursive inscriptions are as follows:

  • Inefficient DApps — As recursion can enable complex execution logic and various DApps, developers might resort to chaining a massive number of inscriptions together in their quest to create apps that are as sophisticated as possible. This could have a detrimental effect on these apps’ performance — let’s not forget that Bitcoin has never had built-in, native functionality to support blockchain applications, and inscriptions are essentially a workaround to enable these apps.

  • Negative impact on network efficiency and costs —The same excessive chaining of inscriptions could also lead to deterioration in network efficiency and/or an explosion in transaction costs.

  • Security risks — Certain security risks could be introduced by the programming code used in recursive inscriptions. While sandboxing prevents inscriptions from accessing off-chain data, code that is part of inscribed content can be malicious.

Closing Thoughts

Recursive inscriptions open up myriad new opportunities in the Bitcoin ecosystem. The blockchain, which has primarily been known as a medium for crypto asset transfers and storage, could turn into a major smart contract hub rivaling Ethereum’s — and even into a gargantuan entertainment platform with games, movies, complex 3D animation and various DApps — in order to satisfy just about anyone’s tastes.

While some Bitcoin purists and idealists are skeptical about inscription technology, pointing out that it introduces elements that have never been envisioned for the network, recursive inscriptions don’t embody a concept that will be abandoned or forgotten. The work to transform Bitcoin from a boring transaction ledger into a large DApp, gaming and entertainment giant has started — all thanks to the arrival of recursive inscriptions.

#Bybit #TheCryptoArk 

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