2024-04-05
Binance, one of the leading cryptocurrency exchanges, made headlines recently with its decision to gradually phase out its support for Bitcoin nonfungible tokens (NFTs). This move comes after initially introducing Bitcoin NFTs to its marketplace a few months ago.
On April 4, Binance announced its plans to streamline its product offerings on the Binance NFT marketplace.
As part of this process, the platform will cease to support trades and deposits of Bitcoin Ordinals, also known as Bitcoin NFTs, starting from April 18.
To ensure a smooth transition, Binance advised its users to withdraw their Bitcoin NFTs from the Binance NFT Marketplace via the Bitcoin network before May 18, 2024, 00:00 (UTC). This gives users ample time to secure their assets and make the necessary arrangements for the future.
Additionally, Binance disclosed that after April 10, 2024, the Binance NFT marketplace will no longer provide airdrops, benefits, and utilities related to Bitcoin NFTs. This means that users will no longer have access to the associated perks and rewards that were previously offered.
Bitcoin Ordinals, the Bitcoin NFTs in question, allow for the embedding of digital content such as artwork, text, or video directly onto the Bitcoin blockchain.
This capability has been available within the Bitcoin protocol for a while, but it gained significant attention with the introduction of Ordinals in late 2022. Developed by Casey Rodarmor, this protocol enables the direct embedding of unique digital art into Bitcoin transactions, similar to Ethereum's popular nonfungible tokens (NFTs).
In the announcement, Binance specifically mentioned that users of Runestone NFT, who meet the requirements for the airdrop, should withdraw their tokens by April 10, 2024, 10:00 (UTC) to ensure they can still receive any associated tokens, utilities, and benefits after that date. This deadline serves as a reminder for users to take action and secure their assets accordingly.
This decision by Binance has taken many in the community by surprise. Binance only added support for Bitcoin NFTs a year ago, in May 2023, in an effort to expand its ecosystem to the Bitcoin network and provide more opportunities for collectors.
However, it appears that the high volume of NFT transactions has caused congestion on the Bitcoin network multiple times since its inception. This congestion has resulted in increased fees and slower processing times as more transactions are validated on-chain.
According to data from Dune Analytics, the Bitcoin network has accumulated over 64 million inscriptions to date, generating over $423 million in transaction fees. These numbers highlight the significant activity and demand for NFTs on the Bitcoin blockchain.
