While Bitcoin's price is a key driver of the cryptocurrency's appeal, analysts say the development of new improvements and use cases will be the real drivers of its global adoption.
Web3 services company Bitget has published a report recently highlighting the potential of the Ordinals protocol, Bitcoin's NFT protocol, and the Lightning Network, the cryptocurrency's second-layer scalability solution, in the mass adoption of BTC. The company noted that the remarkable growth that the Ordinals protocol has had, since its creation to date, is one of the most concrete examples of how Innovation is accelerating the use of blockchain and cryptocurrency most capitalized in the world, beyond its use as an alternative investment asset.
As the company noted, in one year, the Ordinals protocol has reached a market value of over $4.000 billion, growing more than 40 times since it surpassed the $100 million mark in March. Although this protocol has found many detractors in the Bitcoin community, it has become one of the fastest growing sectors within the Bitcoin ecosystem.
On the other hand, the company highlighted that Bitcoin scaling solutions, among which the Lightning Network stands out, are in the spotlight in the current Bitcoin market, thanks to the fact that it provides an additional layer on the blockchain, which allows users to make payments and micropayments with the cryptocurrency, with very low commission fees. This is especially important when considering that the high demand for Ordinals has raised the average Bitcoin transaction fees above $ 20 dollars, in the last days.
Participation in the Bitcoin ecosystem
The security that characterizes the Bitcoin network has been a key factor in the growth and expansion of the ecosystem. However, the company highlights that, beyond this security, innovation and development within the Bitcoin ecosystem is what has been accelerating its growth, exponentially, in the last year. Innovations such as Ordinals and the Lightning network have attracted significant participation from several market players, including individual investors, exchanges, projects, miners and investment institutions, to this thriving blockchain ecosystem.
BRC-20 tokens based on Ordinals exhibit a significant wealth creation effect in the Bitcoin ecosystem, Web3 noted, despite it still being a relatively small market compared to the overall NFT market. According to Bitget, Ordinals have a growth potential of more than 100 times in the future.
On the other hand, in reference to the Lightning Network, he highlighted that it has been becoming “the main technological support for the broader adoption of Bitcoin payments in the short and medium term”, by allowing users to carry out transactions with BTC almost immediately and with very low transaction fees.
A promising outlook
Bitget believes that the innovation offered by the Ordinals protocol, by unlocking a new use case for Bitcoin, and the Lightning Network, by improving the speed and accessibility of BTC payments, are two key drivers that will propel the cryptocurrency into its next bull run.
Coupled with the macroeconomic conditions of the market, with the US Federal Reserve mulling the possibility of reducing interest rates next year, Web3 believes that, overall, the Bitcoin ecosystem has a promising outlook for the future.
“Popular cryptocurrencies like BTC and ORDI will not only have significant room for appreciation, but there will also be new opportunities to 100x coins within the Bitcoin ecosystem.”
Over the past year, BTC and ORDI have appreciated by 154% and 100% respectively, according to data from cryptocurrency price monitoring platform CoinMarketCap.
Despite the positive outlook on Ordinals, not everyone in the Bitcoin ecosystem is happy with this development. Adam Back, CEO of Blockstream, is one of the figures who has spoken out against these listings and, although he believes it is almost impossible to stop them, he has expressed his concerns about the congestion that these tokens have been generating on the Bitcoin network.
However, recently, Back also highlighted a positive point about this NFT protocol, stating that the high transaction fees that ordinals are causing in Bitcoin will further encourage innovation in the Bitcoin ecosystem, as well as the development of Layer 2, with solutions such as the Lightning Network.
Continue reading: Bitcoin transaction fees rise, motivated by Ordinals
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