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NFT 101 | What are Ethscriptions?

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The introduction of Bitcoin Ordinal Inscriptions has had a tremendous impact on the Web3 area. Countless Inscriptions have been created, motivating well-known projects to move from Ethereum and Solana to Bitcoin.

Ethscriptions, a recently introduced (and swiftly accepted) protocol that permits the creation and distribution of digital entities on the Ethereum blockchain (as long as they’re under 96 kilobytes in size), also appears to have been influenced by ordinals.

Since its June 17 introduction, Tom Lehman, a co-founder of, has generated over 130,000 Ethscriptions, demonstrating the innovation’s popularity. Lehman also unveiled Ethereum Punks, a collection of 10,000 Punks that were all claimed in a matter of hours, to heighten the frenzy.

But how exactly do Ethscriptions work, and how do they compare to Ordinals?

Ethscriptions are a new method for creating on-chain digital artifacts on the Ethereum blockchain. They were launched in June 2023 as a way to store collectible digital artworks directly within Ethereum transactions.

Unlike ERC-721 NFTs which have their own smart contracts, Ethscriptions harnessing Ethereum “Calldata” — a container for data transmitted alongside an Ethereum transaction

To inscribe non-financial data directly onto the Ethereum main chain eg. off-chain media via a URI pointer.

Some key advantages of Ethscriptions include potentially lower costs by avoiding smart contracts, while still allowing provable digital scarcity since they are immutable records on Ethereum. However, a potential downside is an Ethereum upgrade could prune old call data, affecting their longevity.

Ethscriptions function by allowing users to record non-financial information on the Ethereum blockchain. The protocol operates based on three key rules:

1. A successful Ethereum transaction must include valid and unique data URI.

2. To transfer a valid Ethscription, the sender must be its owner, and the Ethereum transaction must include a valid Ethscription transaction hash in its input data.

3. The uniqueness of URIs requires that the content doesn’t match that of an Ethscription from a previous block or a transaction in the same block.

A notable aspect of Ethscriptions is the requirement for a 96KB file size for a single asset. As per creator Tom Lehman, Ethscriptions currently support only image storage, with plans to expand to other file formats in the future.

Ethscriptions differ from conventional NFTs in two important ways. As discussed earlier, ethscriptions are kept in transaction calldata. The ability to save data at the transaction level might allow Ethscriptions to be cheaper than NFTs.

Furthermore, unlike regular NFTs, Ethscriptions lack smart contract logic, which makes them less composable. The physics of Ethscription storage, however, may be their greatest weakness. A proposal to reduce transaction calldata is included in the Ethereum “Purge” update (EIP-4444), which could have an impact on how long the Ethscription storage format lasts.

Bitcoin Ordinals also allows creating unique digital artifacts by assigning identification numbers to satoshis based on the blockchain transaction history. Ordinals build provenance into tokens themselves.

In contrast, Ethscriptions focus more on using transactions as a storage mechanism, while the artwork resides off-chain. Both models avoid minting new tokens, leveraging the base blockchain transactions instead.

A key difference is Ethscriptions are simpler and quicker to create, not relying on the ordinal math used to trace satoshis. However, Ordinals may offer better longevity as inscriptions are directly written into Bitcoin’s UTXO set, while Ethscriptions rely on calldata remaining unpruned.

There are also some concerns around imagine copyright with Ethscriptions since they point to generic URLs rather than storing media directly on-chain like Ordinals. Overall though, both show how base blockchain transactions can enable new digital artifact models without bloating the state with endless new tokens.

It remains to be seen whether Ethscriptions gain lasting traction or end up as more of a short-term novelty. However, they highlight Ethereum’s ongoing technical innovation in response to developments like Ordinals on Bitcoin. This ongoing interplay between the two networks will likely continue driving new blockchain use cases and models.

While still early, digitally scarce artifacts created at the base transaction layer demonstrate the deeper programmability of blockchain beyond just payments. Ethscriptions offer Ethereum’s unique take on this growing realm of on-chain digital ownership and creativity.

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