What Are Inscriptions in Crypto?

In the blockchain space, the term inscription refers to metadata attached to individual units of cryptocurrency. Inscriptions became popular when the crypto community started attaching pieces of data to satoshis, the smallest units of bitcoin (BTC). They are essentially pieces of information, such as text, images, or code, appended to the transaction outputs on the Bitcoin blockchain.

How Bitcoin Inscriptions Work

When a user makes a Bitcoin transaction, they can include additional data in the form of inscriptions. This metadata becomes a permanent and immutable part of the transaction, stored on the decentralized and public ledger of the Bitcoin blockchain.

The process of inscribing satoshis allows for the creation of unique, non-fungible “digital artifacts”. This is achieved through a numbering system known as the Ordinal Theory. The emergence of blockchain inscriptions is closely related to the Bitcoin Ordinals protocol, which uses Ordinal Theory to assign numbers to each satoshi based on the order in which they were mined.

Bitcoin Ordinals

Bitcoin Ordinals were introduced in 2023 as a method of creating Bitcoin NFTs by attaching information to satoshis. Ordinals in the context of Bitcoin refer to the numbered and inscribed satoshis created through the Ordinals protocol.

BRC-20 Tokens

BRC-20 is an experimental token standard that enables the minting and transferring of fungible tokens via the Ordinals protocol on the Bitcoin blockchain. BRC-20 tokens leverage the simplicity, immutability, and security of Bitcoin. Each token generated using the BRC-20 standard is essentially an inscription on a satoshi.

What Are the Differences Between Inscriptions, Ordinals, and BRC-20?

Inscriptions are metadata added to units of cryptocurrencies. Ordinals were introduced by the Bitcoin Ordinals protocol as an outcome of blockchain inscriptions. It uses Ordinal Theory to assign numbers to satoshis. BRC-20 is an experimental token standard on the Bitcoin blockchain that uses the Ordinals protocol.

  • Inscriptions vs. Ordinals: Inscriptions are the added metadata, while ordinals are the outcome of this process, representing numbered and inscribed satoshis.
  • Ordinals vs. BRC-20: Ordinals are a protocol for numbering and inscribing satoshis, whereas BRC-20 is a token standard leveraging Ordinals for creating fungible tokens on the Bitcoin blockchain.
  • Inscriptions vs. BRC-20: Inscriptions refer to the added metadata, while BRC-20 tokens are a specific application of inscriptions, representing fungible tokens on the Bitcoin blockchain.

Pros and Cons of Bitcoin Inscriptions

Through the Ordinals protocol, Bitcoin inscriptions have expanded the use cases of the Bitcoin network. They enable the creation of digital artifacts, including non-fungible tokens (NFTs), art, collectibles, and more. 

However, the introduction of inscriptions has not been without controversy. Some within the Bitcoin community argue that the relative simplicity of Bitcoin, focused on transferring and storing value, should be preserved. On the other hand, supporters see inscriptions as a positive evolution, introducing new features and utilities to the Bitcoin network.

One notable challenge is the competition for block space between regular Bitcoin transactions and inscribed satoshis, leading to increased network fees. Despite the divided opinions, the Ordinals project has undeniably brought innovation to the Bitcoin space.

Blockchain Inscriptions Beyond Bitcoin

The trend of blockchain inscriptions, initially popularized by Bitcoin Ordinals, has expanded beyond the Bitcoin community. Ethereum, Avalanche, and a growing number of projects across the blockchain space are embracing the concept of inscriptions to enhance the functionality and versatility of their networks.


Inscriptions represent a novel way to enhance the functionality of the blockchain networks. In the context of Bitcoin, the Ordinals protocol uses inscriptions as a mechanism for attaching metadata to satoshis, allowing for the creation of unique digital assets. The relationship between inscriptions and BRC-20 tokens showcases how Bitcoin, traditionally viewed as a medium for financial transactions, is evolving to accommodate a broader range of functionalities.

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