According to a study released by Galaxy Research on Friday, Bitcoin’s non-fungible tokens (NFTs) will likely reach a $4.5 billion market cap within the next two years.
The renowned crypto research reported that Bitcoin NFTs gained popularity in the last two months, garnering over 200,000 inscriptions since December.
Bitcoin NFTs are some of the first-ever NFT assets tied directly to their native tokens, with ordinals technology allowing NFT creators to encrypt their media into individual Bitcoin units.
Galaxy Research suggests that the market holds much potential for the future of Bitcoin. Alongside its future market cap price, Bitcoin NFTs will provide more space and possibilities for asset owners to experiment with.
While Bitcoin’s ordinal inscription technology is currently solely used to store data for NFTs, Galaxy Research implies that it could expand on different kinds of “decentralised software or bitcoin scaling techniques.” These new developments may further Bitcoin usage and adoption.
If bitcoin adoption is now 1-5% then we will enter the vertical of the S-curve next couple of years.
On log scale (left) this just means more exponential growth until 50% adoption. For the linear thinkers (right) everything will change. Bitcoin might be substantially undervalued. pic.twitter.com/IEnKYw5Ixz— PlanB (@100trillionUSD) February 28, 2023
However, as the current technology is still in its early phases, Galaxy Research noted that significant improvements to Bitcoin’s infrastructure are still necessary for further advancement.
The research predicted that these infrastructure transformations might come as soon as the second quarter of 2023, just a few months from now.
Future concerns
As a relatively recent phenomenon in the Bitcoin community, Bitcoin NFTs and ordinal inscriptions have raised concerns about the blockchain’s uses and viability.
While proponents say the technology will bring new users and activities to the network, critics suggest that the size of inscriptions will slow the network and make the blockchain less accessible for regular financial usage.
Furthermore, some have said that Bitcoin’s use in NFTs goes against its financial purposes. As the network was initially made for financial transactions, it allows people to upload questionable or potentially illegal data that may pose a risk to the entire system.
Despite these concerns, Bitcoin NFTs still strongly hold the ecosystem. Famous Ethereum-based NFT creator Yuga Labs announced its new Bitcoin NFT collection TwelveFold this week, a testament to the popularity of inscription-based technology.