Ordinal Inscription Size Limits

Ordinal Inscription Size Limits

Original Postby Nagaev Boris

Posted on: December 29, 2023 19:01 UTC

Exploring innovative methods of storing data within the Bitcoin blockchain has garnered attention due to its potential for both efficiency and concealment.

One such technique involves utilizing multi-signature (multisig) transactions, specifically 1/n multisig configurations. The idea is to store additional data within the dummy public keys that make up the multisig—except for one legitimate key required for transaction validation. Since this data resides in the witness part of a Bitcoin transaction, it is challenging to differentiate it from standard multisig transactions.

A further strategy relates to Taproot, Bitcoin's protocol improvement that enables more privacy in transactions. By manipulating Merkle proofs within Taproot, which are inherently limited to a depth of 128 levels, one can create a structure with a single valid leaf node and incorporate extraneous data into the remaining 127 elements. This approach allows the calculation of a valid Merkle root while embedding hidden information.

Despite these clever means of data insertion, there is an underlying issue: they are not immune to prohibition if the community decides to take action against such practices. However, it is highlighted that preventing these methods in a decentralized system like Bitcoin is complex without undermining its voluntary nature. A practical response to those potentially misusing transaction space for data storage is to allow natural economic deterrents to play out, namely the depletion of the perpetrator's funds through the high cost of these activities. Meanwhile, adopting the Lightning Network for payments presents a viable alternative, offering both efficiency and reduced on-chain footprint, thereby circumventing the need to embed data within transaction structures.

In conclusion, while there are inventive ways to embed data within Bitcoin transactions, their sustainability is questionable. The anticipation that bad actors will eventually exhaust their financial resources serves as a passive countermeasure, while the community continues to leverage more efficient payment channels such as the Lightning Network.