The Bitcoin ecosystem returns to its peak, how CEX seizes the lead in the "Inscriptions Battle"

Author: Mia, ChainCatcher

As the U.S. interest rate hike cycle gradually approaches its end, the global financial markets are beginning to recover, and the cryptocurrency market is no exception. With strong market expectations following the U.S. SEC's approval of Bitcoin spot ETFs, the wealth effect of Bitcoin has become increasingly significant, with Bitcoin's price rising from $16,500 at the beginning of the year to $44,000. The influx of substantial funds due to the rise in token prices has also propelled the Bitcoin ecosystem into a period of rapid development once again, including a wave of inscription assets such as BRC20 and Ordinals ARC20 on Bitcoin and other chains. Naturally, as an "indispensable part" of the crypto market, it will not miss the opportunity to seize this new blue ocean in crypto.

On December 12, Binance officially launched the BRC-20 project Sats (1000SATS) and added a seed label for it, making it the second inscription asset launched by Binance after ORDI in November. With this support, inscription assets have entered an era of widespread FOMO, and the inscription market has welcomed a new era of "chaos." According to Dune data, as of December 26, the cumulative fee revenue from Ordinals protocol inscriptions has exceeded 5,000 BTC, approximately $215,697,899, while the total number of minted inscriptions has approached 52 million. Additionally, charts show that after April 2023, Ordinals inscription assets have maintained a high minting volume, which fully demonstrates the enthusiasm of on-chain players for inscriptions.

Image source: https://dune.com/dgtl_assets/bitcoin-ordinals-analysis

Despite the on-chain data, centralized exchanges in the secondary market appear particularly passive. Since inscription assets have adopted a "Fair Launch" model allowing users to mint fairly without VC pre-allocations, investors have more say, and under these conditions, traditional centralized exchanges have lost their unique advantages. Faced with the increasingly rigid landscape of centralized exchanges, it is undeniable that the vast blue ocean market of inscriptions has become a new breakthrough to break the deadlock. So how should centralized exchanges seize the market and regain their voice in this "inscription war"? How far can the inscription reform path of centralized exchanges go?

OKX

According to data statistics, influenced by Bitcoin Ordinals trading, the daily trading volume of the OKX NFT Marketplace surpassed $50 million on December 18, exceeding Blur ($13.21 million), Magic Eden, and OpenSea, becoming the largest NFT market by daily trading volume. This growth is attributed to OKX's strategic support for BRC-20 and Bitcoin Ordinals. Undoubtedly, the keen market sense of the OKX Web3 wallet has made it a standout in this "inscription war."

In fact, as early as May this year, the BRC-20 concept began to emerge with its "first come, first served" mechanism, and a significant influx of funds from the meme coin craze started to flow into the Bitcoin ecosystem, leading to a boom in BRC-20 minting and trading activities. As of May 18, 2023, there were already 24,677 types of BRC-20 tokens, with a total market capitalization of $466 million. Among them, Ordi had the highest market capitalization, accounting for 66.7% of the total BRC-20 market cap.

As an early supporter and builder of the Bitcoin ecosystem, OKX quickly sensed the "wealth code" within it, becoming the "first mover" among many CEXs. OKX also announced its Web3 wallet Bitcoin ecosystem roadmap on May 16, which indicated that the OKX Web3 wallet would launch a BRC-20 trading market, supporting BRC20 token trading, BTC cross-chain swaps, and by late May to early June, it would support Ordinals inscriptions and BRC-20 token minting, Ordinals NFT trading, STX Staking (BTC layer 2), and BRC20 Staking, making the OKX Web3 wallet the first multi-chain wallet to support Ordinals.

According to Dune data, as of now, the total trading volume of the OKX Web3 wallet Ordinals market has approached $1 billion, reaching $979,501,762, which accounts for about 45% of the total trading volume of the Ordinals protocol, approximately $2.15 billion. Additionally, other data from the OKX Ordinals market is also impressive, with a total number of transactions reaching 484,791 and the number of unique addresses at 107,507, making the OKX Web3 wallet Ordinals market the largest BRC20 inscription and BTC NFT trading market.

Image source: https://dune.com/cszeth/ordinals-marketplace-okx

As the concept of inscriptions develops, the inscription market is also flourishing in a multi-chain ecosystem, expanding from the Bitcoin ecosystem to other ecosystems including Arbitrum, Solana, Avalanche, BNB Chain, and Polygon. Even some long-dormant on-chain ecosystems like Fantom and Dfinity have seen the emergence of some inscription projects. This has prompted OKX to develop towards the multi-chain field. Currently, the OKX Web3 wallet inscription tool has added support for chains such as Mantle, Celo, Metis, Klaytn, Gnosis Chain, Goerli, and Sepolia, cumulatively supporting 22 public chains. According to the official introduction, through the OKX Web3 wallet inscription tool, users can choose between text mode or hexadecimal mode to inscribe single or multiple texts in batches, and the multi-chain support also allows OKX to dominate the inscription market.

Binance

As a veteran exchange in the first tier of CEXs, Binance appears somewhat less competitive in this wave of "inscription competition." Compared to OKX's bold attempts, Binance's performance in inscriptions has been very conservative, having only launched Ordinals (ORDI) and Sats (1000SATS), and on the 2nd, it launched the BRC-20 project Sats (1000SATS) and 1000SATS 1-50x U-based perpetual contracts. In terms of the Web3 wallet, Binance has shown no support for inscriptions. In response, Binance co-founder He Yi stated that the user complaints about the Binance Web3 wallet being difficult to use may be because the product research team initially regarded BRC20 as a new thing with strong periodicity, unsure of whether it would gain popularity in the future, so the resources invested were insufficient, but they will pay more attention moving forward.

Binance has also faced controversy over its Web3 wallet operations. Currently, Binance's Web3 wallet supports 37 public chains, including most Layer 1 and Layer 2 chains. In contrast, OKX's wallet supports 61 chains and notably supports the Bitcoin network. While Binance has been labeled as a "winner takes all," OKX's rich on-chain functionality and support for the Bitcoin network seem to be more advantageous.

Perhaps Binance's development strategy should shift from industry competition to innovation and research. Although the currently launched ORDI and Sats have shown good momentum, much of it can be attributed to market factors and accumulated "big factory dividends." How to secure a position in the Bitcoin ecosystem is what Binance needs to consider in the innovation of new things like BRC20. Whether the Bitcoin ecosystem is a "trend" or a "flash in the pan," it holds enormous potential as an industry blue ocean, and CEXs are the stewards. Regarding the so-called "closed-door development," Binance needs more industry reflection and new development strategies.

Bitget

Compared to the previous two exchanges, Bitget, as a rising star in CEXs, has taken a rather unconventional approach in the inscription space. Instead, Bitget has chosen to carve out a niche by focusing on BRC20 small tokens and inscription tokens on other chains outside the Bitcoin ecosystem. It has successively launched inscription tokens on the Solana chain such as SOLS and Zero, as well as BRC20 tokens MICE (MICE), BRC20.COM (COM), MMSS (MMSS), and Comsats (CSAS). This reflects Bitget's market strategy in the inscription sector and also showcases the broader possibilities brought by multi-chain inscriptions.

In the future, we can imagine that inscription tokens could be issued on every public chain like traditional crypto tokens and traded normally on CEXs. Bitget's involvement in multi-chain inscription tokens effectively proves this possibility. Perhaps more and more project teams will begin to adopt inscriptions as a way to issue tokens, and Bitget is likely to become the preferred trading platform and testing ground for these niche tokens.

As the development of inscription tokens gains wider recognition and application in the industry, Bitget's involvement in inscription tokens will become a significant strategy, releasing its voice and influence in the inscription field while also enhancing its brand influence as a crypto exchange.

The Inscription Market May Create a New Landscape for CEXs

Looking back at history, the entire development of the crypto market shows that, compared to the early beneficiaries of the Ethereum DeFi ecosystem, there will also be enormous opportunities in the new wave of the Bitcoin ecosystem, and the same goes for exchanges. According to data, BTC's market capitalization currently still accounts for over 50% of the total cryptocurrency market capitalization, possessing the strongest consensus. The emergence of the inscription concept compensates for the Bitcoin ecosystem's inability to accommodate smart contracts, placing the Bitcoin ecosystem and the Ethereum ecosystem on equal footing again. This is also the best time for the Bitcoin ecosystem to return to its peak. Therefore, whether in the inscription sector or the Bitcoin ecosystem, there is significant development potential and expectations.

In the face of the rapidly changing crypto industry, perhaps whoever can first create a complete set of CEX trading methods for inscriptions and master the voice of the Bitcoin ecosystem will become the helmsman of the next bull market. Currently, OKX is leading the industry in its involvement in inscriptions, while Bitget has chosen a different path. He Yi's recent remarks suggest a strategic adjustment for Binance and a determination to increase investment in BRC20. The "inscription war" among CEXs is about to ignite, and it remains to be seen who will become the leader of the future Bitcoin ecosystem.