Key Takeaways:
- Bitcoin STAMPS utilise base64-formatted image data to embed images directly onto the Bitcoin blockchain, ensuring permanence and immutability of digital assets.
- The protocol aims to provide a secure means of storing unique digital assets with a focus on permanence and security.
- Bitcoin STAMPS distinguish themselves from other methods like Ordinals by storing metadata within multi-signature UTXO, ensuring greater permanence.
- Minting a Bitcoin STAMP involves creating a transaction on the Bitcoin blockchain with embedded metadata and image data, followed by confirmation through mining.
- The technology behind Bitcoin STAMPS offers intriguing possibilities for expanding the use cases of Bitcoin and facilitating the creation and trading of Bitcoin-native NFTs.
- Platforms like Rare Stamp, OpenStamp, Stampscan, and StampedNinja offer Bitcoin STAMPS and SRC-20 tokens, catering to the growing interest in Bitcoin-based digital assets.
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What Are Bitcoin STAMPS? A Unique Protocol for Storing Assets on the Bitcoin Blockchain
Bitcoin STAMPS, also referred to as ‘Stamps’, represent an innovative and compelling addition to the world of non-fungible tokens (NFTs) and tokenisation on the Bitcoin blockchain, offering collectors and creators a secure and reliable means of storing unique digital assets with a focus on permanence and security.
Developed by Mike In Space, they aim at permanence and immutability by storing data directly on the Bitcoin blockchain, making it impossible to prune from a full node.
Since their launch, Bitcoin STAMPS have seen rapid adoption and interest, with over 16,500 STAMPS created in just 32 days, outpacing the daily growth of assets compared to Ordinals.
How Do Bitcoin STAMPS Work?
Bitcoin STAMPS embed image data directly onto the Bitcoin blockchain by utilising base64-formatted image data, allowing for the representation of images in a text format that can be embedded within the Bitcoin blockchain.
The technology leverages unspent transaction outputs (UTXOs) within the Bitcoin blockchain to store the metadata associated with the image data. This distinguishes the protocol from other methods like Ordinals, which store metadata within the ‘witness’ segment of a Bitcoin transaction.
The distinctive storage method of STAMPS ensures that the data becomes an integral part of the blockchain and is impossible to prune from a full node, contributing to its permanence and immutability.
What Is the Difference Between Bitcoin STAMPS and Ordinals?
While Bitcoin STAMPS and Ordinals Protocol have some similarities, they differ in the following:
During the height of Ordinals inscription, some Bitcoin core developers said they did not want to embed so much ‘valueless’ information into Bitcoin transactions, and there has been discussion about refusing to sign such transactions. In fact, miners do have the right to refuse to synchronise such transactions.
Based on this dispute, Mike In Space proposed the STAMPS protocol, which aims to broadcast entire text content onto the Bitcoin chain using the Counterparty protocol and uses the base64 encoding mechanism and ‘stamp’: prefix to make the corresponding Counterparty transaction recognised as a P2SH type of transaction.
This type of transaction needs to split the data and embed it into multiple transaction outputs and cannot be ‘deleted’ by Bitcoin full nodes, thus achieving permanent storage of image data. The biggest advantage of the BTC STAMPS protocol over the Ordinals protocol is that its data storage is based on the simplest transaction outputs, so Bitcoin full nodes have no choice but to choose to save BTC STAMPS.
In contrast, OP_RETURN and ‘witness data’ (the solution adopted by Ordinals) may be trimmed by full nodes. This is also why SRC-20 (STAMPS) transaction validity confirmation is longer than BRC-20 (Ordinals).
Ordinals, on the other hand, offer advantages, like a lower average cost for NFTs in the crypto landscape, making them more affordable to build. Moreover, Ordinals can support image inscriptions of up to 4 MB, which is too large for STAMPS.
Unfamiliar with Ordinals? Learn more.
Are Bitcoin STAMPS and SRC-20 Tokens the Same?
Another common question is if STAMPS are SRC-20 tokens. The short answer is no. STAMPS is a protocol on the Bitcoin blockchain that allows users to create NFTs, while SRC-20 is a fungible token standard that follows the Bitcoin STAMPS implementation.
The SRC-20 protocol was created by Mike In Space in reference to the BRC-20 model during the BRC-20 ecosystem outbreak in March 2023. While STAMPS are data inscriptions on the Bitcoin blockchain that enable the creation of tokens, SRC-20 tokens run parallel with the native bitcoin on the Bitcoin network. All fees for transactions involving SRC-20 tokens are paid in bitcoin.
Learn more about the SRC-20 protocol here.
For more about the STAMPS protocol, check out this GitHub.
How to Mint Bitcoin STAMPS
STAMP 0 was the first STAMP ever minted. Here are its metrics:
Bitcoin STAMP 0:
- Creator: Mike In Space
- Minted: March 2023
- This marked the first transaction to add an authentic base64 string to the description key of a Bitcoin transaction, serving as the initial Bitcoin STAMP.
To mint STAMPS, below is the step-by-step process:
- Token Creation:
- To mint a Bitcoin STAMP, a user initiates the process by creating a new transaction on the Bitcoin blockchain. This transaction includes the necessary metadata and image data encoded in base64 format, representing the unique characteristics of the NFT.
- Embed Metadata:
- The minting process involves embedding the metadata of the NFT directly into unspent transaction outputs (UTXOs) of the Bitcoin blockchain. This ensures that the data becomes an integral and immutable part of the blockchain, providing long-term permanence.
- Transaction Confirmation:
- Once the transaction is created and broadcast to the Bitcoin network, it undergoes confirmation and inclusion in a block through the process of mining. This confirms the creation and embedding of the new Bitcoin STAMP within the blockchain.
- Verification and Accessibility:
- After confirmation, the newly minted Bitcoin STAMP becomes accessible and verifiable by users and applications interacting with the Bitcoin blockchain. This allows for the discovery and utilisation of the unique NFT represented by the STAMP.
- Market Integration:
- Minted Bitcoin STAMPS can be integrated into various NFT marketplaces and platforms that support the trading and transfer of SRC-20 tokens, making them available for purchase, sale, and exchange within the NFT ecosystem.
Considerations when minting Bitcoin STAMPS:
Permanence and Immutability
- The minting process ensures that the embedded metadata and image data of the NFT become securely stored within the Bitcoin blockchain, providing permanence and immutability for the created Bitcoin STAMP.
Transaction Costs
- Minting a Bitcoin STAMP may involve transaction costs associated with creating and embedding the metadata into the blockchain, which can vary based on network congestion and other factors affecting Bitcoin transaction fees.
In summary, the minting process for Bitcoin STAMPS involves the creation and embedding of unique NFTs within the Bitcoin blockchain, ensuring their permanence and accessibility within the NFT ecosystem. This process plays a crucial role in expanding the use cases of Bitcoin and facilitating the creation and trading of Bitcoin-native NFTs.
Where Can You Buy Bitcoin STAMPS?
If minting your own isn’t your thing, you can also buy STAMPS. Platforms like Rare Stamp, OpenStamp, Stampscan, and StampedNinja offer STAMPS and SRC-20 tokens.
The Rare Stamp platform provides detailed information on sale prices, new collections, and other unique features, catering to the growing interest in Bitcoin-based digital assets and the demand for more permanent and secure solutions.
Conclusion
The technology behind Bitcoin STAMPS revolves around the unique embedding of image data into the Bitcoin blockchain using base64 formatting and storage within multi-signature UTXOs. This approach ensures permanence, immutability, and security for digital assets, making it an intriguing addition to the landscape of blockchain-based digital art and collectibles.
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