Introduction to Bitcoin NFTs

Bitcoin (via the Counterparty internet protocol) played a very dominant role in the very earliest of NFTs/tokenized assets. NFTs were first popularized on Bitcoin’s Counterparty protocol between 2014 and 2016. The significance of these origin assets being tokenized to bitcoin should not be overlooked in terms of the security, decentralization and longevity that this provides.

Mind you, it was Namecoin (formerly known as BitDNS, a hard fork of Bitcoin which Satoshi Nakamoto himself endorsed) which gets credited for issuing the first NFTs in history: Quantum, Blockheads, Comicons and Cryptoeggs were basically avatar projects which sought to provide every new user a unique digital identity. They weren’t meant to become collectibles, but people started trading them and they accrued market value. Several years later, Ethereum would copy this approach with CryptoPunks and other similar computer-generated avatars that you can see in Twitter avatars today.

But after the Counterparty protocol launched in January 2014, bitcoiners started to create their own form of tokenized art. From this point onwards, you can identify two significant schools of thought: the video game asset innovation side (Shaban Shaame’s “Spells of Genesis” and Christian Moss’ “SaruTobi Island” cards being two of the finest examples) and the meme side (Rare Pepes, Fake Rares, Leftist Tears, Bitcoin Heads).

Of course, not all of these NFTs emerged in 2014. The Rare Pepe directory was first created in September 2016, Spells of Genesis cards first appeared in September 2015, while Fake Rares and Bitcoin Heads were issued in the second half of 2021.

Yet the element that makes them stand out is the fact that they’re user-generated via graphic design software or even hand drawing. Bitcoiners love proof of work – so unlike their Namecoin and Ethereum counterparts (no pun intended), they don’t issue art that a computer generated automatically. You can find a charming human element in all of these Bitcoin NFTs.

Ownership and viewability are two different things when it comes to digital art. All certified Rare Pepes can be viewed on the Rare Pepe directory, and any internet user can easily download these images to whichever device they may be using.

Using Counterparty tokens as easily transferable certificates of authenticity, a programmer or artist has no reason to limit viewability. In this fashion, completely preventing people from sharing ownership IS impossible. If you don’t own the private keys which control the address where the token is assigned, you don’t own the art.

This method detracts individuals from implying that there is value in just the art, but rather that there is value in ownership of both the digital art and token. People won’t spend money to own an image file which can be shared or viewed easily, but they will certainly pay for ownership of a token generated by the artist which provably shows they are the owner of that piece of art. People can, will and already have spent considerable amounts of money on Rare Pepes via Counterparty tokens on the DEX (or even via OTC sales).