Elon Musk Slams NFTs, Backs Bitcoin Ordinals

Tesla CEO and billionaire Elon Musk is apparently backing  Bitcoin Ordinals, also known as Bitcoin NFTs, while publicly mocking nonfungible tokens (NFTs) during a podcast.

"The funny thing is, the NFT is not even on the blockchain — it's just a URL to the JPEG," Musk stated on The Joe Rogan Experience podcast on October 31.

Musk stated that NFT projects should at the very least encode the JPEG on-chain:

“You should at least encode the JPEG in the blockchain. If the company housing the image goes out of business, you don’t have the image anymore.”

Bitcoiners argued on social media that Musk's remarks summed up the use case for Bitcoin Ordinals.

asey Rodarmor launched Bitcoin's version of NFTs in January, which was made possible by the Taproot soft fork in November 2021.

Will Clemente, a cryptocurrency analyst, was among those that praised Musk's remarks, noting that there are 38 million Ordinals inscriptions that will forever exist on Bitcoin's blockchain.

"This is why Ordinals will continue to grow," Rohun "Frank" Vora, stated, whoich is the creator of the NFT projects DeGods and y00ts. "It's the most elegant solution to one of the most universal criticisms of NFTs."

The Ordinals developer known as "Leonidas" was so taken with Musk's comments that they inscribed the 19-second video into the Bitcoin blockchain at block 814,773.

Musk's criticisms of NFTs are not novel. He mocked NFTs as a sign of mental illness in a meme depicting a patient lying on a therapist's couch in December 2021.

Musk's remarks, however, do not apply to all NFT projects on Ethereum.

Larva Labs, for example, moved its CryptoPunks NFTs on-chain in August 2021 after living off-chain for the first four years.

"Storing them on-chain in this way would further cement the long-term survival of the Cryptopunks images and attributes, and ensure that they can be fully accessed by anyone with only an Ethereum client," the company said in a statement.

In September, Metagood, the team of the Ethereum-native OnChainMonkeys, announced that it would migrate its NFTs to Bitcoin.

While the CEO of the company, Danny Yang, did not directly address the JPEG issue, he did say that NFTs "will win on Bitcoin" because it is a more secure network to work from:

“The Bitcoin Ordinal protocol is better designed for decentralization and security than the Ethereum NFT protocol. High-value NFTs will win on Bitcoin.”

However, according to CoinGecko data from June, Ethereum still accounts for 84% of all NFT trading volumes.

Bitcoin and ImmutableX came in second and third, with 11% and 2.5% market shares, respectively.

Sources:

https://cointelegraph.com/news/elon-musk-slams-nfts-jpeg-url-argues-case-bitcoin-ordinals

https://open.spotify.com/episode/7edwvm2c6Ieuzun4xtFYCJ

https://twitter.com/frankdegods/status/1719644838818410656

https://x.com/LeonidasNFT/status/1719582173718863934

https://www.larvalabs.com/blog/2021-8-18-18-0/on-chain-cryptopunks

https://www.coingecko.com/research/publications/market-share-nft-blockchains