Inscription Heat’ brings pressure testing, can the public chains other than Bitcoin handle such a surge of wealth and prosperity?

Will 'Inscription Heat' Boost Public Chains? Evaluating Pressure Testing and the Potential for Wealth and Prosperity Beyond Bitcoin

Author | Terry

Published by | Plain Language Blockchain

With the “Mingwen Fever” spreading from Bitcoin to other chains, a series of corresponding “Mingwen projects” have emerged on public chains such as Ethereum, Solana, EOS, TON, IOST, Conflux, etc. in recent weeks. The activities on the chains have surged, which can be considered as a stress test to some extent.

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So, how did the public chains that often claim to have high TPS and high performance perform in this stress test?

01. Congested Bitcoin, a feast for block producers

First, let’s take a look at the Bitcoin network at the center of the Mingwen craze. Its most obvious change is “network congestion and skyrocketing transaction fees”.

Mingwen is similar to NFT, allowing users to record various types of data on the blockchain. However, since Bitcoin transaction fees are paid based on data size, Mingwen users tend to set relatively low transaction fees.

This also means that they are willing to wait longer for confirmation, which can easily result in Mingwen transactions being replaced by more urgent Bitcoin transfers.

In this context, these massive Mingwen transactions, which emerge in large numbers but are willing to wait in line, have flooded the Bitcoin memory pool (where all valid transactions that have not been formally added to the network are stored).

According to statistics from crypto KOL bitrabbit.btc, Bitcoin has accumulated 87 million UTXOs in the past 14 years. However, since the start of BRC20 trading on April 24, in about 7 months, it has skyrocketed to 140 million UTXOs. And of the newly added 50 million UTXOs, 40 million are extremely small transactions ranging from 100 to 1000 satoshis.

The above figure shows that since its launch in February 2023, Mingwen has always been the main consumer of Bitcoin block space, and the Bitcoin memory pool has been full since February. This situation continues until now.

This has also caused the Bitcoin network to be unable to clean its memory pool and is currently at a high level in BTC’s history of data records at the time of writing this article.

According to the current situation of the Bitcoin network, especially to prevent dust attacks, the Bitcoin network requires that the transaction amount within a single UTXO must be no less than 546 satoshis. This means that a large majority of the pending small amount transactions among the tens of millions of Mingwen transactions are actually equivalent to junk transactions in DDoS attacks, and they may never be packaged and broadcasted on-chain in their lifetime.

“Most of these small UTXOs will never be spent, but will lie forever in Bitcoin nodes, wasting billions of dollars in hardware and power resources for the BTC network in the next few decades or even centuries.”

This is also the main reason why Luke Dashjr, a developer of the Bitcoin Core client, publicly criticized ORDI, Glyph, and BRC20—”Glyph is using Bitcoin Core vulnerabilities to send junk information to the blockchain.“

However, for block producers, Glyph Fever undoubtedly brought a season of bountiful harvest. OKLink statistics show that before November, transaction fees accounted for 2% to 5% of block rewards for Bitcoin block producers.

However, since the return of Glyph Fever in November, the proportion of transaction fees to total block producer income has continued to rise, reaching more than 10% and even exceeding 20% on certain dates. As of the time of writing, it reached a recent high of 25.84% on December 14, significantly increasing the income of block producers.

In addition, Dune data shows that Glyph has generated a total transaction fee of 3,615 BTC (approximately $150 million) for block producers.

Regardless of the future direction of Glyph, it is somewhat deeply connected to the block producer community—with the diminishing block rewards after each Bitcoin halving cycle and the continuous expansion of the entire Bitcoin network, the ecological incentives required to maintain the security operation of the Bitcoin network are objectively increasing, which needs to gradually expand beyond block rewards.

Therefore, the appearance of Glyph can be said to be timely, at least the possibility given by programmability can explore alternative ways of block producer incentives after the continuous reduction of block rewards in the future.

02. How are the “Ethereum killers” and new public chains performing?

After the explosion of the Glyph ecology in Bitcoin, although the market also made jokes about conducting Glyph on smart contract public chains such as Ethereum as “automatic downgrade,” Glyph Fever quickly spread to a group of other public chains.

Among them, in addition to PoW chains such as BCH, other smart contract public chains have also entered the scene, giving rise to a large number of projects that imitate the concept of inscription and play, and also experienced a moment of truth.

• Ethereum: Gas fees break out of the bottom range

Before this round, Ethereum’s on-chain transaction costs had been gradually declining since mid-year, until around October 14, when it reached the lowest level of $1.4 in 2023. Gas also dropped to below 10.

However, starting from late October, with the overflow of the wealth effect brought by Bitcoin’s inscription, Ethereum began to experience a new wave of enthusiasm, and Gas started to rebound, rising all the way to the range of 30-50 where it currently stands, but still within a normal and acceptable range.

This allows non-financial and arbitrary data to be written onto the Ethereum blockchain, as long as the file size does not exceed 96 kilobytes, users can engrave any type of file. According to its creator, although it currently only allows images, it will change in the future.

In fact, the engraving of ETHS utilizes the so-called Ethereum “call data (Calldata)”, which is cheaper and more decentralized than using contract storage. It even introduces the possibility of a new L2 narrative – when compared with other L2 solutions such as ZK and ARB, ETHS achieves Gas that is even cheaper than L2 without the need for network switching.

• EOS: Severe congestion, intermittent suspension of transfer and minting services

On December 9, the EOS network introduced the inscription eoss minting activity inspired by Ordinals, which resulted in a significant increase in on-chain activities on the EOS EVM chain, with the number of transactions surpassing 17 million, exceeding the total accumulated number of transactions in the chain’s history.

Due to the surge in on-chain activities, it caused severe congestion in transaction processing speeds on the EOS chain, and the EOS network’s transaction processing experienced prolonged delays, with millions of transactions waiting to be processed.

• TON: “Fastest Blockchain” in chaos

The TON blockchain, which previously planned to apply for a Guinness World Record as the “fastest blockchain” claiming to process over 1 million transactions per second, also encountered setbacks in the inscription fever.

After the introduction of the Tonado protocol, inspired by Bitcoin Ordinals, and the resulting surge in activity on the TON network, transaction processing on the network experienced long delays.

According to monitoring data from the blockchain status monitoring robot dTON, on December 7th, there were over 2.5 million pending transactions on the TON chain, with transaction processing speed on the TON blockchain dropping to less than 1 transaction per second.

This situation also forced the TON cryptocurrency wallets Wallet and Tonkeeper to temporarily suspend their services.

• NEAR: Smooth, but with a unique approach

Although the experience of inscribing on NEAR has been reported to be very smooth, the way transactions are executed in the inscription market is somewhat unique:

Inscriptions are packaged as NRC-20 tokens on NEAR, using official tools, and then traded on DEXs such as Ref on the NEAR chain, a somewhat unconventional approach.

• IOST: A feast for scientists

In addition, during the inscription process on IOST last night, the “fair launch” was heavily criticized and almost became a gathering for scientists, with very few opportunities for ordinary users to participate successfully. Twitter user @chems_zz reported running more than a dozen private IOST nodes, all of which performed poorly.

03. Summary

Overall, in this wave of inscription challenges, regardless of how impressive the usual promotional data may be, these high-performance public chains that emphasize speed and low cost have suffered setbacks or performed poorly, blatantly revealing their true capabilities under extreme stress tests.

In contrast, Bitcoin and Ethereum, despite congestion on their mainnets and soaring transaction fees, have maintained good transaction execution performance.

Time reveals the truth. In recent years, the allure of high performance has diminished, and there is a significant correlation with this——for public chains, providing a stable trading liquidity operational environment remains the most important.

Falling behind in performance indeed means missing out on many use cases, but experiencing lags or even crashes will result in losing everything.

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